Operating Profit Margin

Posted in Finance, Accounting and Economics Terms, Total Reads: 733

Definition: Operating Profit Margin

Operating profit margin may be defined as the amount of profit that the company generates after paying off the all the variable costs such as wages, raw materials etc. It is generally expressed as a percentage of sales.

The formula for calculating the operating profit margin is:

= Operating income / Total revenue

= Earnings before interest and taxes / Total revenue.


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