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    d.hasini20's Avatar
    d.hasini20 Posts: 3, Reputation: 1
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    #1

    Dec 26, 2010, 08:36 AM
    Operating ratio-management accounting
    When sales,admini expenses,selling expenses and gp is given... how do v calculate the operating ratio
    Just Looking's Avatar
    Just Looking Posts: 1,610, Reputation: 480
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    #2

    Dec 26, 2010, 05:46 PM

    operating ratio = operating expenses / net sales

    Operating expenses are the day-to-day expenses such as selling expenses, general and administrative expenses, and R&D - as opposed to manufacturing/production costs.
    d.hasini20's Avatar
    d.hasini20 Posts: 3, Reputation: 1
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    #3

    Dec 27, 2010, 01:51 AM
    But what do v do with the GP
    Just Looking's Avatar
    Just Looking Posts: 1,610, Reputation: 480
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    #4

    Dec 27, 2010, 02:58 AM
    Quote Originally Posted by d.hasini20 View Post
    but what do v do with the GP
    You don't need it to compute the ratio.
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