A company has actual sales of Rs. 1,000,000 and break-even sales of Rs. 700,000. What is its margin of safety in rupees?
Correct answer: C. Rs. 300,000
- A. Rs. 200,000
- B. Rs. 700,000
- C. Rs. 300,000
- D. Rs. 1,700,000
Explanation
Margin of safety equals actual sales minus break-even sales. Therefore, Rs. 1,000,000 minus Rs. 700,000 gives Rs. 300,000.
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