In Cost-Volume-Profit (CVP) analysis, the margin of safety is the excess of expected revenue above the break-even point.

Here's a step-by-step explanation:

1. The break-even point is the point where total revenue equals total costs, meaning the company neither makes a profit nor incurs a loss.

2. Expected revenue is the amount of revenue a company anticipates earning in a future period.

3. The margin of safety is the difference between the expected revenue and the break-even point. It shows how much sales can decrease before the company starts to incur losses.

So, the margin of safety is the "excess of expected revenue above the break-even point".

Question

In Cost-Volume-Profit (CVP) analysis, the margin of safety is the excess of expected revenue above the break-even point.

Here's a step-by-step explanation:

1. The break-even point is the point where total revenue equals total costs, meaning the company neither makes a profit nor incurs a loss.

2. Expected revenue is the amount of revenue a company anticipates earning in a future period.

3. The margin of safety is the difference between the expected revenue and the break-even point. It shows how much sales can decrease before the company starts to incur losses.

So, the margin of safety is the "excess of expected revenue above the break-even point".

Knowee AI · Accepted Answer

In Cost-Volume-Profit (CVP) analysis, the margin of safety is the excess of expected revenue above the break-even point.

Here's a step-by-step explanation:

1. The break-even point is the point where total revenue equals total costs, meaning the company neither makes a profit nor incurs a loss.

2. Expected revenue is the amount of revenue a company anticipates earning in a future period.

3. The margin of safety is the difference between the expected revenue and the break-even point. It shows how much sales can decrease before the company starts to incur losses.

So, the margin of safety is the "excess of expected revenue above the break-even point".

In CVP analysis the margin of safety is the:Group of answer choicesnone of the options are true.excess of the break-even point over actual sales.excess of expected revenue above the break-even point.excess of the operating leverage above revenu

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