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Margin of Safety
The difference between actual or projected sales and the break-even point. It indicates the amount of sales decline a business can endure before it starts incurring losses.
Variable Costs
Costs that change in proportion to the level of activity or production volume.
Fixed Costs
Costs that do not vary with the level of output or sales, such as rent, salaries, and insurance premiums.
Operating Income
A measure of a company's profit generated from its core business operations, excluding deductions of interest and tax.
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