Final answer:
The operating margin and operating profit for each year are calculated by subtracting the cost of goods sold and operating expenses from sales revenue.
Step-by-step explanation:
To calculate the Operating Margin for each year, you need to subtract the cost of goods sold (COGS) and selling, general, and administrative expenses (SG&A) from the sales revenue. The formula is:
Operating Margin = (Sales - COGS - SG&A) / Sales * 100%
2020:
Operating Margin = ($50M - $30M - $10M) / $50M * 100% = 20%
2021:
Operating Margin = ($55M - $32M - $13M) / $55M * 100% = 10.91%
2022:
Operating Margin = ($60M - $34M - $16M) / $60M * 100% = 8.33%
To calculate the Operating Profit, subtract the Operating Expenses from the Operating Margin:
Operating Profit = Operating Margin - Operating Expenses
2020:
Operating Profit = 20% - $7M = $13M
2021:
Operating Profit = 10.91% - $8M = $5.91M
2022:
Operating Profit = 8.33% - $9M = -$0.67M