1.

Calculate operating profit ratio under the following casesCase 1: Revenue from operations Rs. 16,00,000 operation profit Rs. 4,00,000Case 2: Revenue from operations Rs. 40,00,000 operating cost Rs. 28,00,000 Case 3: Revenue from operations Rs. 20,00,000 Gross profit 25% on revenue from operations; operating expenses Rs. 2,00,000.

Answer»

Case 1: Operating profit ratio = (Operating profit)/(Revenue form operating) x 100

= 4,00,000/16,00,000 x 100 = 25%

Case 2: Operating profit ratio = (Operating profit)/(Revenue from operating) x 100

Operating profit = Revenue form operations - operating cost

= 40,00,000 - 28,00,000 

= Rs. 12,00,000

\(\therefore\) Operating profit ratio = (Operating profit)/(Revenue from operating) x 100

Operating profit = Gross profit – Operating expenses 

Gross profit = 25% of 20,00,000 

= Rs. 5,00,000 

Operating profit = 5,00,000 – 2,00,000 

= Rs. 3,00,000 

∴ Operating profit ratio = 3,00,000/20,00,000 x 100 = 15%



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