Respected Tutor,
Sir i have a general doubt related to throughput account ratio(TPAR) why is it calcuated as throughput per factor hr/factory cost per factory hour and not as Throughput per factory hr- factory cost per factory hr?
In simple words why are we using a division operation when we could do we away with subtraction. Both of them will essentially tell us whether or not there is a profit per factory hour
Regards,
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TPAR
5y ago#1Simply because that is the standard way and why it is called a ratio!
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