Actual sales are Rs. 500,000 and break-even sales are Rs. 350,000. The margin of safety is:

A. Rs. 850,000
B. Rs. 350,000
C. Rs. 150,000
D. Rs. 30,000
Correct Answer: C. Rs. 150,000

Margin of safety = actual sales - break-even sales = 500,000 - 350,000 = Rs. 150,000.

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