Reading comprehension is a skill that empowers lifelong learning intelligence for a better self.
The margin of safety (MOS)..
✅ ..is the difference between the actual or expected level of sales and the breakeven point.
✅ ..represents the amount by which sales can fall before a company starts making a loss.
✅ ..[▲ MOS] is generally considered better because it indicates that a company has a greater cushion to absorb unexpected drops in sales or increases in costs.
✅ ..provides a sense of security to managers and investors, as it indicates that the company is less likely to experience financial distress.
✅ ..[▼ MOS] indicates that a company is operating closer to its breakeven point, which means that it is more vulnerable to changes in the market or any unexpected expenses.
✅ ..can be a cause for concern for managers and investors, as it may increase the risk of financial losses or bankruptcy.
✅ ..a higher margin of safety would be better than the lower one.