diff --git a/cpp/include/cudf/binaryop.hpp b/cpp/include/cudf/binaryop.hpp
index 72abefef04f..71ac591b67e 100644
--- a/cpp/include/cudf/binaryop.hpp
+++ b/cpp/include/cudf/binaryop.hpp
@@ -146,7 +146,7 @@ std::unique_ptr<column> binary_operation(
   column_view const& lhs,
   column_view const& rhs,
   binary_operator op,
-  data_type output_type,
+  thrust::optional<data_type> output_type,
   rmm::mr::device_memory_resource* mr = rmm::mr::get_current_device_resource());
 
 /**
diff --git a/cpp/include/cudf/detail/binaryop.hpp b/cpp/include/cudf/detail/binaryop.hpp
index c12482967e1..147e5b71381 100644
--- a/cpp/include/cudf/detail/binaryop.hpp
+++ b/cpp/include/cudf/detail/binaryop.hpp
@@ -60,7 +60,7 @@ std::unique_ptr<column> binary_operation(
   column_view const& lhs,
   column_view const& rhs,
   binary_operator op,
-  data_type output_type,
+  thrust::optional<data_type> output_type,
   rmm::cuda_stream_view stream        = rmm::cuda_stream_default,
   rmm::mr::device_memory_resource* mr = rmm::mr::get_current_device_resource());
 
diff --git a/cpp/src/binaryop/binaryop.cpp b/cpp/src/binaryop/binaryop.cpp
index fc697267ca7..c6e8f506924 100644
--- a/cpp/src/binaryop/binaryop.cpp
+++ b/cpp/src/binaryop/binaryop.cpp
@@ -783,27 +783,36 @@ std::unique_ptr<column> binary_operation(column_view const& lhs,
 std::unique_ptr<column> binary_operation(column_view const& lhs,
                                          column_view const& rhs,
                                          binary_operator op,
-                                         data_type output_type,
+                                         thrust::optional<data_type> output_type,
                                          rmm::cuda_stream_view stream,
                                          rmm::mr::device_memory_resource* mr)
 {
   CUDF_EXPECTS(lhs.size() == rhs.size(), "Column sizes don't match");
 
-  if (lhs.type().id() == type_id::STRING and rhs.type().id() == type_id::STRING)
-    return binops::compiled::binary_operation(lhs, rhs, op, output_type, stream, mr);
-
   if (is_fixed_point(lhs.type()) or is_fixed_point(rhs.type())) {
-    auto const type =
-      op == binary_operator::TRUE_DIV ? output_type : thrust::optional<data_type>{thrust::nullopt};
-    return fixed_point_binary_operation(lhs, rhs, op, type, stream, mr);
+    if (op != binary_operator::TRUE_DIV) {
+      CUDF_EXPECTS(
+        not output_type.has_value(),
+        "Only TRUE_DIV supports specified output_type for fixed_point binary operations. For other "
+        "fixed_point binary operations, please pass {} or std::nullopt for output_type and the "
+        "cudf::data_type and numeric::scale_type will be automatically calculated.");
+    }
+
+    return fixed_point_binary_operation(lhs, rhs, op, output_type, stream, mr);
   }
 
+  CUDF_EXPECTS(output_type.has_value(), "Must specify output_type of column.");
+  // Use output_type.value() for the rest of the function
+
+  if (lhs.type().id() == type_id::STRING and rhs.type().id() == type_id::STRING)
+    return binops::compiled::binary_operation(lhs, rhs, op, output_type.value(), stream, mr);
+
   // Check for datatype
-  CUDF_EXPECTS(is_fixed_width(output_type), "Invalid/Unsupported output datatype");
+  CUDF_EXPECTS(is_fixed_width(type), "Invalid/Unsupported output datatype");
   CUDF_EXPECTS(is_fixed_width(lhs.type()), "Invalid/Unsupported lhs datatype");
   CUDF_EXPECTS(is_fixed_width(rhs.type()), "Invalid/Unsupported rhs datatype");
 
-  auto out = make_fixed_width_column_for_output(lhs, rhs, op, output_type, stream, mr);
+  auto out = make_fixed_width_column_for_output(lhs, rhs, op, output_type.value(), stream, mr);
 
   if (lhs.is_empty() or rhs.is_empty()) return out;
 
@@ -868,7 +877,7 @@ std::unique_ptr<column> binary_operation(column_view const& lhs,
 std::unique_ptr<column> binary_operation(column_view const& lhs,
                                          column_view const& rhs,
                                          binary_operator op,
-                                         data_type output_type,
+                                         thrust::optional<data_type> output_type,
                                          rmm::mr::device_memory_resource* mr)
 {
   CUDF_FUNC_RANGE();
diff --git a/cpp/tests/binaryop/binop-integration-test.cpp b/cpp/tests/binaryop/binop-integration-test.cpp
index 2d17853a72b..b39f586b8ea 100644
--- a/cpp/tests/binaryop/binop-integration-test.cpp
+++ b/cpp/tests/binaryop/binop-integration-test.cpp
@@ -22,6 +22,7 @@
 #include <cudf/fixed_point/fixed_point.hpp>
 #include <cudf/scalar/scalar_factories.hpp>
 #include <cudf/types.hpp>
+#include <cudf/utilities/error.hpp>
 #include <cudf/utilities/type_dispatcher.hpp>
 
 #include <cudf_test/column_utilities.hpp>
@@ -2123,6 +2124,9 @@ TYPED_TEST(FixedPointTestBothReps, FixedPointBinaryOpDiv2)
   auto const result = cudf::binary_operation(lhs, rhs, cudf::binary_operator::DIV, {});
 
   CUDF_TEST_EXPECT_COLUMNS_EQUAL(expected, result->view());
+  auto output_type = cudf::data_type{type_to_id<decimalXX>(), scale_type{1}};
+  EXPECT_THROW(cudf::binary_operation(lhs, rhs, cudf::binary_operator::DIV, output_type),
+               cudf::logic_error);
 }
 
 TYPED_TEST(FixedPointTestBothReps, FixedPointBinaryOpDiv3)