The operating margin ratio

Read Assignment 1 in Chapter 11 and in 300-350 words, answer the following questions:

What does operating margin tell you about the organization and how would you calculate this ratio?
Select a local medical service organization and describe how they have specifically improved their operating margins.

Week 3 Discussion 2

Read Assignment 2 in Chapter 12 and in 300-350 words, answer the following questions:

What are the commonly used financial ratios and how would you calculate?
Select a local for profit hospital and compare its financial ratios for the most recent three years against the national norms for that type of institution.

Week 3 Assignment

Financial Ratios Analysis and Comparison Paper

Review Chapter 10 and 12 in your course text. Write a four to five page double-spaced report (excluding title and reference pages), covering the following:

You are a mid-level manager in a health care organization and you have been asked to prepare a report, with appropriate exhibits, for the senior financial officer.

Discuss the roles played by financial ratios in general and analyze the commonly used financial ratios by categories.b. Additionally, select a local hospital and compare its financial ratios for the most recent three years against the national norms for this type of institution. Include analytical comments and how the organization compares to the national norms as well as any suggestions as to how results could be improved.

Your paper must include an introduction, thesis, and conclusion and be four to five page double-spaced (excluding title and reference pages) and formatted according to APA style as outlined in the Ashford Writing Center. Utilize a minimum of three- to- five scholarly and/or peer-reviewed sources (excluding the course text) that were published within the last five years, in APA format.

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The operating margin ratio is a profitability ratio which shows an organization’s operating income as a percentage of its revenue. The operating ratio which is also called return on sales ratio can be defined as a ratio of operating income of an organization to its revenue. The operating ratio is calculated using the following formula,

Operating Margin= Operating Income/Revenue (Operating Income divided by Revenue). It is important to state that the operating Income and the Revenue of the organization are obtained from the organization’s income statement (Brigham et al, 2009). An organization which has a higher value of the operating margin ratio indicates………………..

APA

380 Words