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About operating gearing

Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA PM Exams › About operating gearing

  • This topic has 1 reply, 2 voices, and was last updated 1 year 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: 51557
    • ☆☆☆☆☆

    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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