The formulas used in the calculations are:
\[ \text{Operating Income} = \text{Revenue} - \text{Cost of Goods Sold} - \text{Operating Expenses} \]
\[ \text{Operating Profit Margin} = \frac{\text{Operating Income}}{\text{Revenue}} \times 100 \]
This calculator computes the Operating Profit Margin based on the input values of Revenue, Cost of Goods Sold, and Operating Expenses. The Operating Profit Margin represents the percentage of revenue that has turned into operating profit, indicating the efficiency of a company in managing its operating costs and generating profit from its core business activities.
Let's assume the following:
Calculate the Operating Income:
\[ \text{Operating Income} = 10,000,000 - 5,000,000 - 2,500,000 = 2,500,000 \]
Calculate the Operating Profit Margin:
\[ \text{Operating Profit Margin} = \frac{2,500,000}{10,000,000} \times 100 = 25\% \]
Therefore, the Operating Profit Margin is 25%.
