Hi,
If operating profit margin formula is PBIT/ REVENUE, with PBIT including finance cost, why does BPP Revision Kit question 232, answer they dont included the finance cost.
Also for Gearing ratio, I'm getting if the ratio is Long term interest debt/ long term interest debt + equity OR Debt/equity
Thank you,
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Operating profit margin
3y ago#1Hi,
For gearing, it can be calculated either way.
The question will possibly have just taken the PBIT figure, hence not required to adjust for any finance cost. I've not got the question bank to hand currently, sorry.
Thanks
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