Question

Calculate operating ratio:
Cost of goods sold= ₹ 5,60,000, Operating expenses= ₹ 48,000,
Sales = ₹ 8,00,000, Sales Return= ₹ 48,000.

Answer 1

Net sales = Sales – Sales return

= 8,00,000 – 48,000

= ₹ 7,52,000

Operating ratio = `("Cost of Goods Sold" + "Operating Expenses")/"Net sales" xx 100`

` = (5,60,000 + 48,000)/(7,52,000) xx 100`

`= (6,08,000)/(7,52,000) xx 1000`

`= 80.85%`