Margin of safety, Cost Accounting

Assignment Help:

Margin of safety

Measures the sensitivity of budgeted sales volume compared with break-even sales volume. The difference between level of sales activity achieved and level of sales activity required to break-even in absolute or percentage terms.

Margin of safety (units)= Budgeted sales volume less Break-even sales volume

Margin of safety (%)= (Budgeted sales less Break-even sales volume/ Budgeted sales volume) x 100 Number of units sold to achieve a target profit= (Fixed cost + Target profit)/Contribution per unit


Related Discussions:- Margin of safety

Relevant costs, What are investment appraisal methods when opening a new pr...

What are investment appraisal methods when opening a new project?

Costs and revenue, Costs and Revenue Cost of the development work ...

Costs and Revenue Cost of the development work done in-house to 1 January 2009 has been £1.5m with a further cost of £50,000 per month from now until the software is ready

Marginal cost, contribution per unit 8 fixed cost=800.find B.E.P?

contribution per unit 8 fixed cost=800.find B.E.P?

Calculate the taxable profit, Gustav Ltd commenced operations on 1 July 201...

Gustav Ltd commenced operations on 1 July 2011 and presents its first statement of comprehensive income for the year ending 30 June 2012 and first statement of financial position a

absorption costing principles, Determine the  factors  that distinguish pr...

Determine the  factors  that distinguish profit  calculated according  to  (a) marginal  costing and  (b) absorption costing principles.

Cost classification, #question.discuss the importance of cost classificatio...

#question.discuss the importance of cost classification to a business organisation?

Critical thinking about cvp, The Critical Thinking about CVP is described b...

The Critical Thinking about CVP is described below CVP is more than just a mathematical tool/device to calculate values such as the break-even point. It can be used for the cri

Differential costing, explain the practical application of differential cos...

explain the practical application of differential costing with the help of suitable example.

Labour costs, what are the classifications of labour costs? what is employe...

what are the classifications of labour costs? what is employee psyche?

Overhead anaylsis sheet, how do we prepare an overhead analysis sheet when ...

how do we prepare an overhead analysis sheet when the data given is already apportioned

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd