How to calculate ROS in Excel
Return on Sales (ROS) is a financial ratio that measures a company’s efficiency in generating profits from its revenue. It is calculated by dividing the operating profit (or income) by the net sales. A higher ROS indicates greater profitability and better control over costs.
In this tutorial, I’ll show you how to calculate ROS in Excel with a simple formula. All you need are two inputs: operating profit and net sales. Alternatively, you can use EBIT (earnings before interest and taxes) as a proxy for operating profit and revenue for net sales.