The Formula for Calculating Operating Expenses Percentage Is

question 40

Multiple Choice

The formula for calculating operating expenses percentage is

• A) total sales/operating expenses.
• B) gross sales/operating expenses.
• C) operating expenses/net sales.
• D) average sales/gross sales.
• E) total sales/average sales.

---

Definitions:

Selling Price

The amount for which a product or service is sold to the customer, which may include cost, overheads, and profit margin.

Variable Manufacturing Overhead

Expenses related to manufacturing that fluctuate with production volume, including costs for supplies and variable labor.

Machine-Hours

A measure of production time using machinery, often used to allocate manufacturing overhead based on the time machines are used in the production process.

Predetermined Overhead Rate

A calculated rate used to assign overhead costs to products or services, based on estimated or budgeted overhead expenses and activity.