What is the operating profit margin ratio?

Q: What is the operating profit margin ratio?
Answer:
Operating profit margin ratio return type, known as margin money. Information with which to calculate the operating profit margin obtained from the company's profit (loss) statement.

Operating profit margin = operating profit / sales income = _______%

Operating income is often referred to as earnings before income and taxes, or EBIT. EBIT of the left-profit (loss) statement when all operating costs and overheads, such as selling expenses and administrative costs, together with the cost of goods sold is deducted from income.
Operating profit margin = EBIT / Sales revenue = ________%

What Operating profit margin Tell the business owner?

Operating profit margin of the business owner a lot of important information about the company's profitability, particularly in terms of cost control. This shows how much money is thrown, when the majority of costs are met. High operating profit margin means the company has good cost control and / or sales to rise faster than costs, which is the optimal situation of the company. Operating profit will be much less than the gross profit from sales, administrative and other costs involved with the cost of goods sold.

As the company grows and increases sales revenue, overhead, fixed costs, would become a smaller percentage of the total costs and operating profit margin should increase. High operating profit margin, usually means that businesses low-cost business model.

Sources :
http://en.wikipedia.org/wiki/Operating_margin
http://bizfinance.about.com/od/financialratios/f/Operating_Profit_Margin.htm