Operating earnings is a metric to measure profitability. Operating Earnings are earnings which are left after accounting for operating expenses and costs.
The formula :
Operating Earnings = revenue - operating costs-operating expenses
Cost of Goods Sold
Other operating expenses
Using this information and the formula above, we can compute the operating earnings of company ABC to be:
Operating Earnings = ₹2,000,000 - ₹600,000 - ₹400,000 - ₹60,000 = ₹940,000
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