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    Question

    If profit is ₹12,000 and the P/V ratio is 0.3, what is

    the Margin of Safety?
    A ₹30,000 Correct Answer Incorrect Answer
    B ₹36,000 Correct Answer Incorrect Answer
    C ₹40,000 Correct Answer Incorrect Answer
    D ₹48,000 Correct Answer Incorrect Answer
    E ₹52,000 Correct Answer Incorrect Answer

    Solution

    Profit = Margin of Safety × P/V ratio Margin of Safety = Profit ÷ P/V ratio = 12,000 ÷ 0.3 = ₹40,000

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