Why would a company calculate its operating margin?
A)to evaluate how well resources are being used to generate profits
B)to determine how efficiently it is using resources to make and sell products
C)to assess if it has the resources to meet the claims of short-term creditors
D)to evaluate how efficiently managers are turning inventory over
E)to monitor if managers are collecting revenue from customers

Question

Quizplus · Accepted Answer

Operating margin is a measure of how efficiently a company is using its resources to produce and sell products, reflecting the percentage of revenue that remains after covering operating expenses.

Why Would a Company Calculate Its Operating Margin