- . The break-even point can usually be determined by simply adding together all of the expenses from the income statement.
- . Two companies with the same margin of safety in dollars will also have the same total contribution margin.
- . If a company has high operating leverage, then profits will be very sensitive to changes in sales.
- . Operating leverage will decrease as the company’s margin of safety increases.
- . The overall contribution margin ratio for a company producing three products may be obtained by adding the contribution margin ratios for the three products and dividing the total by three.
