Margin of safety = normal sales-breakeven sales.
Margin of safety = margin of safety ÷ normal sales (or actual order amount) × 100% sales profit rate is an index to measure the income level of enterprise sales revenue. It belongs to profitability indicators, and other indicators to measure profitability include asset profit rate and return on net assets.
Its calculation formula is: sales profit rate = total profit/operating income × 100%.
The commonly known sales interest rate is the gross profit margin, which is just a verbal expression. In fact, the profit rate of sales and the gross profit rate of sales are two different indicators, because the former has eliminated the period expenses, while the latter still includes the period expenses (such as management expenses and financial expenses).
As can be seen from their formula:
Sales profit rate = total profit/operating income × 100%
Gross sales margin = (operating income-operating cost)/operating income × 100%
And total profit = operating income-operating cost-expenses. So it can be seen that the gross profit margin of sales is generally greater than the profit margin of sales. Contribution gross margin is the marginal contribution rate-the percentage of marginal contribution to sales revenue, and its formula is:
Marginal contribution rate = (marginal contribution/sales revenue) × 100%
If it is a product, then:
Marginal contribution rate = (unit marginal contribution/unit price) × 100%
In the case of multiple products:
Marginal contribution rate = ∑ (Marginal contribution rate of each product × proportion of sales revenue of this product to total sales revenue)
General marginal contribution rate refers to the marginal contribution rate of products.
The marginal contribution rate can be understood as the marginal contribution ratio per yuan of sales revenue, which reflects the contribution ability of products to enterprises.
English is the marginal contribution rate in international accounting.
Sometimes referred to as the profit volume ratio.
The calculation formula is: marginal contribution rate = marginal contribution/sales volume.
So: Your formula above is correct.