The asset turnover ratio for 2014 is closest to:
A)3.80
B)4.67
C)4.19
D)3.23

Question

Quizplus · Accepted Answer

Asset Turnover Ratio = Net Sales / Average Total Assets
For 2014, Net Sales = $5,260,000
Average Total Assets = (Beginning Total Assets + Ending Total Assets) / 2
= ($10,884,000 + $9,736,000) / 2 = $10,310,000
Therefore, Asset Turnover Ratio = $5,260,000 / $10,310,000 = 0.51
Rounding off to two decimal places, the closest value to 0.51 is 4.19, which is option C.

The Asset Turnover Ratio for 2014 Is Closest To