148 :- From the following information, calculate Operating Ratio:
Revenue from Operations Rs 10,00,000; Cost of Revenue from Operations Rs 4,00,000; Selling Expenses Rs 80,000; Administrative Expenses Rs 1,20,000.
Goods were sold at a profit of 25% on cost.
Solution :-
Operating Cost = Cost of Revenue from Operations + Administrative Expenses + Selling Expenses
= 4,00,000 + 1,20,000 + 80,000
= Rs 6,00,000
Operating Ratio = (Operating Cost/Revenue from Operations) x 100
= (6,00,000/10,00,000) x 100
= 60%