Operating Profit Margin Calculator

Formula

The formula to calculate the Operating Profit Margin is:

\[ \text{Operating Profit Margin} = \frac{\text{Operating Income}}{\text{Sales}} \times 100 \]

Where:

\(\text{Operating Income}\) is the total income generated after operating expenses but before interest and taxes
\(\text{Sales}\) is the total sales for the period

Operating Profit Margin Definition

The operating profit margin is a margin ratio used to measure a company's pricing strategy and operating efficiency.

Example Calculation

Let's assume the following values:

Operating Income (OI) = $2000
Sales (S) = $1,000,000

Using the formula:

\[ \text{Operating Profit Margin} = \frac{2000}{1000000} \times 100 \]

Evaluating:

\[ \text{Operating Profit Margin} = 0.2 \]

The Operating Profit Margin is 0.2%.

Operating Profit Margin Conversion Table

Operating Income ($)	Sales ($)	Operating Profit Margin (%)
1000	100000	1.000000000000
1000	200000	0.500000000000
1000	300000	0.333333333333
1000	400000	0.250000000000
1000	500000	0.200000000000
2000	100000	2.000000000000
2000	200000	1.000000000000
2000	300000	0.666666666667
2000	400000	0.500000000000
2000	500000	0.400000000000
3000	100000	3.000000000000
3000	200000	1.500000000000
3000	300000	1.000000000000
3000	400000	0.750000000000
3000	500000	0.600000000000
4000	100000	4.000000000000
4000	200000	2.000000000000
4000	300000	1.333333333333
4000	400000	1.000000000000
4000	500000	0.800000000000
5000	100000	5.000000000000
5000	200000	2.500000000000
5000	300000	1.666666666667
5000	400000	1.250000000000
5000	500000	1.000000000000

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