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mediumMCQCUET Accountancy 2022 8 Aug Shift 22026Accountancy
1 mark

Which one higher ratio is not favourable?

  1. A
    Net profit ratio
  2. B
    Stock turnover ratio
  3. C
    Gross profit ratio
  4. D
    Operating ratio

Solution & Step-by-step Explanation

The operating ratio indicates the percentage of net sales consumed by operating expenses. A higher operating ratio means less operating profit margin, which is unfavourable.

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Try it yourself before checking the explanation above.

Which one higher ratio is not favourable?
A
Net profit ratio
B
Stock turnover ratio
C
Gross profit ratio
D
Operating ratio

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