The operating ratio of a firm is 45% and Revenue from Operation is 12,00,000. Calculate the firm's Operating Profit.
Answer & explanation
Correct answer: option 1
O.R + O.P.R = 100%
O.P.R = 100 - 45 = 55%
Operating Profit Ratio = Operating Profit / Sales
55/100 = O.P / 12,00,000
Operating profit = 6,60,000