The following information is provided for Nguyen Company and Northwest Corporation. $$\begin{array} { l c c }
{ \text { (in } \$ \text { millions) } } & \text { Nquyen Company } & \text { Northwest Corporation } \
\hline \text { Net income } 2022 & \$ 165 & \$ 420 \
\text { Net sales } 2022 & 1,650 & 4,900 \
\text { Total assets } 12 / 31 / 20 & 1,000 & 2,400 \
\text { Total assets } 12 / 31 / 21 & 1,050 & 3,000 \
\text { Total assets } 12 / 31 / 22 & 1,150 & 4,000
\end{array}$$ What is Northwest's asset turnover for 2022?
A)1.40 times
B)1.63 times
C)1.81 times
D)1.23 times

Question

The following information is provided for Nguyen Company and Northwest Corporation. $$\begin{array} { l c c } 
 { \text { (in } \$ \text { millions) } } & \text { Nquyen Company } & \text { Northwest Corporation } \
\hline  \text { Net income } 2022 & \$ 165 & \$ 420 \
\text { Net sales } 2022 & 1,650 & 4,900 \
\text { Total assets } 12 / 31 / 20 & 1,000 & 2,400 \
\text { Total assets } 12 / 31 / 21 & 1,050 & 3,000 \
\text { Total assets } 12 / 31 / 22 & 1,150 & 4,000
\end{array}$$ What is Northwest's asset turnover for 2022?
A)1.40 times
B)1.63 times
C)1.81 times
D)1.23 times

Quizplus · Accepted Answer

Asset turnover is calculated as Net Sales divided by Average Total Assets. For Northwest Corporation, the average total assets for 2022 is (3,000 + 4,000) / 2 = 3,500. Therefore, the asset turnover is 4,900 / 3,500 = 1.40 times.

The Following Information Is Provided for Nguyen Company and Northwest