Which of the following phrases best describes the interpretation of the fixed asset turnover ratio?
A)It measures how efficiently sales are generated with a given amount of fixed assets.
B)It measures return on total assets.
C)It measures the speed of cash collected on fixed assets.
D)It measures how quickly fixed assets are bought and sold.

Question

Quizplus · Accepted Answer

The fixed asset turnover ratio measures the efficiency of fixed assets to generate sales revenue.Generally,higher turnover ratios suggest better utilization of fixed assets.

Which of the Following Phrases Best Describes the Interpretation of the Fixed