Practicing Success
Practicing Success
CUET Preparation Today
| Higher the ratio, more favourable it is. This is generally not applicable for which of the following ratio ? |
Operating Ratio Liquidity Ratio Net Profit Ratio Stock Turnover ratio |
| Operating Ratio |
| Operating Ratio is computed to analyse cost of operation in relation to revenue from operations. It is calculated as follows: Operating Ratio = (Cost of Revenue from Operations + Operating Expenses)/ Net Revenue from Operations ×100 . Thus, higher operating ratio will imply higher expenses which in turn means less profit. Hence, the answer is Option 1. |
