Asset turnover is a measure of
A)how quickly a company is replacing its old plant assets with new plant assets.
B)how quickly a company is turning its sales into cash.
C)the overall efficiency with which the company uses assets to generate revenues.
D)how rapidly the stock market believes the company will grow.

Question

Quizplus · Accepted Answer

Asset turnover is a financial ratio that measures how efficiently a company is using its assets to generate revenue. It is calculated by dividing a company's revenue by its total assets. A high asset turnover ratio indicates that the company is effectively using its assets to generate revenue, while a low ratio may indicate that the company is not using its assets efficiently. Therefore, option C is the correct choice.

Asset Turnover Is a Measure of