How Do You Calculate The Operating Loss Margin?
Financial analysts sizing up a business generally take into account a few key measures of performance, including sales, gross margin, net income and operating margin. These line items, which are reported on the income statement, are calculated by deducting expenses associated with the cost of doing business. Gross margin represents the percentage earned after deducting the cost of goods sold. The operating margin looks at the percentage a company makes after deducting operating expenses. Download the annual report for the company. The annual report usually is posted in the investor relations section of the company’s website. If it is not posted, call the contact listed for the company and request an annual report. If you are calculating the ratio for your own company, you will need to access numbers from the income statement. Determine the sales, cost of goods sold and operating expenses associated with making sales. These are standard line items on the income statement. Subtract the c
