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    Question

    Which among the following correctly describes Margin of Safety?

    A Actual Sales – Break Even Sales Correct Answer Incorrect Answer
    B Budgeted Sales – Actual Sales Correct Answer Incorrect Answer
    C Actual Sales – Budgeted Sales Correct Answer Incorrect Answer
    D Break Even Sales – Actual Sales Correct Answer Incorrect Answer
    E None of the above Correct Answer Incorrect Answer

    Solution

    Margin of Safety (MoS) is correctly described as the margin over and above the Break even sales, the company has in terms of current level of sales.

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