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Contribution Margin
The amount of revenue from sales that exceeds variable costs, indicating how much contributes to covering fixed costs and generating profit.
Fixed Expenses
Costs that remain constant for a given period regardless of the level of production or sales activity, such as rent and management salaries.
Break-Even
The point at which total costs and total revenues are equal, resulting in neither profit nor loss.
Margin of Safety
Margin of safety represents the difference between actual or projected sales and the break-even sales levels, measuring the buffer a company has before it incurs a loss.
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