Margin of safety is a financial metric that measures the extent to which actual or...

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Accounting

Margin of safety is a financial metric that measures the extent to which actual or expected sales exceed the break-even point. In other words, it represents the cushion or buffer zone between current sales levels and the
point where a business covers all of its costs, resulting in zero profit or loss. The margin of safety provides insights into a company's risk exposure and its ability to absorb fluctuations in sales or production.
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