Question

______________ is a good indicator of how well the business activities are being managed.

• A. Operating Profit
• B. Net Profit
• C. Both
• D. None

Answer 1

The correct option is A Operating Profit

Operating profit is calculated by deducting the operating expenses from the operating income. Operating expenses are those which are directly related to the core business activity.

Operating profit indicates the earning from the core business operations. Its an indicator of how well a business operations are being managed.