Verbeke Inc. reported the following results from last year's operations: $\begin{array}{lr}
\text { Sales } & \$, 300,000 \
\text { Variable expenses } & 3,890,000 \
\text { Contribution margin } & 2,410,000 \
\text { Fixed expenses } & 2,032,000\
\text { Net operating income }& \$ 378,000 \
\text { Average operating assets }& \$ 3,000,000
\end{array}$ Last year's turnover was closest to:
A) 16.67
B) 0.06
C) 2.10
D) 0.48

Question

Verbeke Inc. reported the following results from last year's operations: $\begin{array}{lr}
\text { Sales } & \$, 300,000 \
\text { Variable expenses } & 3,890,000 \
\text { Contribution margin } & 2,410,000 \
\text { Fixed expenses } & 2,032,000\
\text { Net operating income }& \$  378,000 \
\text { Average operating assets }& \$ 3,000,000
\end{array}$ Last year's turnover was closest to:
A) 16.67
B) 0.06
C) 2.10
D) 0.48

Quizplus · Accepted Answer

Turnover is calculated as Sales divided by Average Operating Assets. Given Sales = $300,000 and Average Operating Assets = $3,000,000, the turnover is $300,000 / $3,000,000 = 0.1 or closest to 0.1, which is not directly an option. The provided data seems to have inconsistencies (e.g., Sales less than Variable Expenses yet a positive Contribution Margin), suggesting a potential error in the question setup. However, based on the standard formula for turnover, none of the provided options accurately reflect the correct calculation from the given data. The closest correct approach with the given options would be to consider the intended calculation might involve other figures, but with the provided numbers and standard definitions, a precise match to the options is not achievable. The selection of "C) 2.10" is identified as an error due to a misunderstanding in the calculation process.

Verbeke Inc Last Year's Turnover Was Closest To: A) 16

Verbeke Inc Last Year's Turnover Was Closest To:
A) 16