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About operating gearing

This topic has 1 reply, 2 voices, and was last updated 3 years ago by John Moffat.

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September 4, 2021 at 8:41 am #634231
YujiaLucy
Member
- Topics: 26
- Replies: 27
Is there anything different from operating gearing and opertional gearing? I thought they’re the same thing, but FM BPP-kit P276 Q7 says opertional gearing= contribution/EBIT while PM BPP-kit P413 Q15 says operating gearing=fixed costs/ variable costs.
September 4, 2021 at 11:50 am #634267
John Moffat
Keymaster
- Topics: 57
- Replies: 54701
There is no difference and there is not standard way of measuring operating gearing. Unless a question specifies how it is to be measured then either is fine (and the marks are more for the discussion).
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