How do you calculate margin of safety?

seespotrun

Simple,

Margin of Safety = Expected/Actual Sales Level - Break Even Sales Level
both can be in quantity or dollar amounts.

Have fun!

ymeski56

OK. I'LL BITE!!!! BUT I AM GOING TO START AN ONGOING CONTEST on this web site I predict will soon become famous!!.....though I'd settle for infamous.It,gonna b called "CAN YOU PLEASE BE A LITTLE LESS SPECIFIC" and within the premise of this contest ,though many other ?s I've come across prior to yours were indeed of great merit, they pale in comparison.So if its ok w/U I will probably make yours, the founding question.(sorry,name changes will only be allow to protect (or protest, if more inconvenient) the innocent. But, I digress (you should try it sometime) Back to your ?. I think it's my turn!.....................Oh...Ummmm......Oh yah "Could U please B a little more specific??? YoUR TURN ! (NON RELATED?? Are U that guy i"ve been hearing about that likes to drop acid & tell knock-knock jokes til it wears off???) Anyway,back to your ?........Who's turn is it?......Hey!!!! Wanna trade turns??

ymeski56

SORRY DUDE, MY BAD!! Did"nt notice I'slipped into the obyss of accounting topics. I though I was still under the "Stupid human tricks"topic. To be continued......................................... ..................

morgaine300

Correct, but it would be easier to read if it didn't look like a division.

i.e. sales level - break even sales level
(where sales level can be budgeted or actual)