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The margin of safety ratio A. is computed as actual sales divided by break-even sales. B indicates what percent decline in sales could be sustained

The margin of safety ratio

A.

is computed as actual sales divided by break-even sales.

B

indicates what percent decline in sales could be sustained before the company would operate at a loss.

C

measures the ratio of fixed costs to variable costs.

D

is used to determine the break-even point.

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