Define the Following:variable

question 27

Essay

Define the following:variable

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Definitions:

Margin Of Safety

The difference between actual or projected sales and the break-even point, indicating the amount by which sales can drop before the business incurs a loss.

Variable Expenses

Charges that escalate or decrease in sync with production quantities or sales levels, involving materials and workforce.

Fixed Expenses

Costs that do not change with the level of production or sales over a short period, such as rent or salaries.

Contribution Margin Ratio

A metric used to assess a product's profitability, calculated by subtracting variable costs from sales revenue and dividing by sales revenue.