OPERATING PROFIT TO SALES Definition

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OPERATING PROFIT TO SALES is a useful ratio when evaluating value of a firm. It discounts the effect of varying tax rates and benefits to give a more accurate indication of the return associated with the firm. Operating Profit (EBITDA) / Net Revenues.

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CLOSING ACCOUNT is the determining the balance of an account and posting an entry to offset such balance.

INFLATION RISK is the risk that total return on the investment is less than the rate of inflation. It is one of the major risks in fixed income securities. Also called Purchasing Power Risk.

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