Question : ___________measures the relationship between Operating Profit and Revenue from Operations, i.e., Net Sales.
Option 1: Operating profit ratio
Option 2: Operating ratio
Option 3: Net profit ratio
Option 4: Gross profit ratio
Answer (1)
18th Jan, 2024
Correct Answer: Operating profit ratio
Solution : Answer = Operating profit ratio
The operating profit ratio measures the efficiency of a company's operations by assessing the relationship between operating profit and revenue from operations (net sales). It indicates the percentage of revenue retained as operating profit after deducting operating expenses.
Hence, the correct option is 1.
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