Question

Operating profit ratio is calculated by___

• A. $\frac{\text{Operating Profit}}{\text{Gross sales}}\times 100$
• B. $\frac{\text{Gross Profit}}{\text{Net Sales}}\times 100$
• C. $\frac{\text{Operating Profit}}{\text{Net Sales}}\times 100$
• D. None of these

Answer 1

The correct option is C

$\frac{\text{Operating Profit}}{\text{Net Sales}}\times 100$

$\text{Operating profit ratio}=\frac{\text{Operating Profit}}{\text{Net Sales}}\times 100$