From the following information, calculate Operating Ratio:

Cost of Revenue Revenue from Operation:

from Operations (Cost of Goods Sold) ₹52,000 Gross Sales ₹ 88,000

Operating Expenses ₹18,000 Sales Return ₹ 8,000

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Solution

$Net Sales = Gross Sales - Sales Return = 88, 000 - 8, 000 = Rs 80, 000$

$Operating Cost = Cost of Goods Sold + Operating Expenses = 52, 000 + 18, 000 = Rs 70, 000 Operating Ratio = \frac{Operating Cost}{Net Sales} \times 100 = \frac{70, 000}{80, 000} \times 100 = 87.5 %$

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Cost of Revenue		Revenue from Operation:
from Operations (Cost of Goods Sold)	₹52,000	Gross Sales	₹ 88,000
Operating Expenses	₹18,000	Sales Return	₹ 8,000

From the following information, calculate Operating Ratio: Cost of Revenue Revenue from Operation: from Operations (Cost of Goods Sold) ₹52,000 Gross Sales ₹ 88,000 Operating Expenses ₹18,000 Sales Return ₹ 8,000

Net Sales = Gross Sales - Sales Return = 88,000 - 8,000 = Rs 80,000 Operating Cost = Cost of Goods Sold + Operating Expenses = 52,000 + 18,000 = Rs 70,000Operating Ratio = Operating CostNet Sales × 100 = 70,00080,000 × 100 = 87.5%

From the following information, calculate Operating Ratio:

Cost of Revenue Revenue from Operation:

from Operations (Cost of Goods Sold) ₹52,000 Gross Sales ₹ 88,000

Operating Expenses ₹18,000 Sales Return ₹ 8,000

$Net Sales = Gross Sales - Sales Return = 88, 000 - 8, 000 = Rs 80, 000$

$Operating Cost = Cost of Goods Sold + Operating Expenses = 52, 000 + 18, 000 = Rs 70, 000 Operating Ratio = \frac{Operating Cost}{Net Sales} \times 100 = \frac{70, 000}{80, 000} \times 100 = 87.5 %$