Ballard Screens has net sales in the amount of $470,000, a cash amount of $246,000, and accounts receivables of $47,000. What is the asset turnover ratio? (Round your answer to two decimal places.)
A) 1.60 times
B) 2.44 times
C) 1.91 times
D) 10.00 times

Question

Quizplus · Accepted Answer

The asset turnover ratio is calculated by dividing net sales by total assets. Here, total assets = cash + accounts receivables = $246,000 + $47,000 = $293,000. Thus, asset turnover ratio = $470,000 / $293,000 = 1.6041, rounded to 1.60 times.

Ballard Screens Has Net Sales in the Amount of $470,000