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Operating Profit Ratio

is the ratio ...

Question

___ is the ratio of cost of goods sold plus operating expenses to net sales.

A

Operating ratio

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B

Net worth ratio

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C

Net worth ratio

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D

None of these

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Solution

The correct option is A
Operating ratio

Operating ratio is the ratio of cost of goods sold plus operating expenses to net sales.

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Cost of goods sold plus operating expenses = __________.

Q. Revenue from operations (Net Sales) Rs 4,50,000; Cost of good sold Rs 3,60,000: Operating expenses Rs 22,500. What will be Operating Profit Ratio?

Q. Operating Ratio 92%; Operating Expenses ₹94,000; Revenue from Operations ₹6,00,000; Sales Return ₹40,000. Calculate Cost of Revenue from Operations (Cost of Goods Sold).

Q. Calculate Operating Profit Ratio,in each of the following alternative cases:
Case 1: Revenue from Operations (Net Sales) ₹ 10,00,000; Operating Profit ₹ 1,50,000.
Case 2: Revenue from Operations (Net Sales) ₹ 6,00,000; Operating Cost ₹ 5,10,000.
Case 4: Revenue from Operations (Net Sales) ₹ 3,60,000; Gross Profit 20% on Sales; Operating Expenses ₹ 18,000
Case 4: Revenue from Operations (Net Sales) ₹ 4,50,000; Cost of Revenue from Operations ₹ 3,60,000; Operating Expenses ₹ 22,500.
Case 5: Cost of Goods Sold, i.e., Cost of Revenue from Operations ₹ 8,00,000; Gross Profit 20% on Sales; Operating Expenses ₹ 50,000.

Q. Cost of Goods Sold is Rs. 1,50,000, Operating expenses are Rs. 60,000. Sales is Rs. 2,60,000 and Sales Return is 10,000. Calculate Operating Ratio.

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