From the following information, Calculate operating ratio.
i. Revenue from operations ₹3,40,000
ii. Cost of revenue from operations ₹1,20,000
iii. Selling expenses ₹80,000
iv. Administrative Expenses ₹ 40,000
Answer & explanation
Correct answer: option 2
The correct answer is Option (2) → 70.59%
Operating ratio = (Cost of revenue from operations + Operating expenses) ÷ Revenue from operations × 100
Operating expenses = Selling expenses + Administrative expenses = ₹80,000 + ₹40,000 = ₹1,20,000
Operating cost = ₹1,20,000 + ₹1,20,000 = ₹2,40,000
Operating ratio = ₹2,40,000 ÷ ₹3,40,000 × 100 = 70.59%
NCERT (2026-27 edition):
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