1) Cost-volume-profit (CVP) is a key step in many decisions. CVP analysis involves specifying a model of the relations among the prices of products, the volume or level of activity, unit variable costs, total fixed costs, and the sales mix. This model is used to predict the impact on profits of changes in those parameters.
2)Margin of Safety means ( actual sales - break-even sales ) . so it means several sales that create a profit for the organization because we know up to break even point all units of sales maintain a profit position so this portion is safe and more margin of safety is better because it will create more safe position, it indicates more sales.
3)Operating leverage is a measure of how sensitive net operating income is to %change in sales. Operating leverage is high near the break even point and decreases with the increase in sales and profit. With a high operating leverage, a small percentage increase in sales can produce a much larger percentage increase in net operating income.