The ________ measures the percentage of profit earned on each sales dollar before interest and taxes.
A) net profit margin
B) operating profit margin
C) gross profit margin
D) earnings available to common shareholders

Question

Quizplus · Accepted Answer

The operating profit margin measures the profitability of a company before any interest or taxes are taken into account. It is calculated as operating income divided by revenue, and represents the percentage of profit earned on each sales dollar before deducting expenses related to interest and taxes. The other options listed are different measures of profitability, but do not factor in interest and taxes.

The ________ Measures the Percentage of Profit Earned on Each