A fixed asset turnover ratio of 4.3 indicates that for every:
A)$1 in sales revenue,the firm acquired $4.30 of assets.
B)$1 in fixed assets,the firm earned $4.30 of net income.
C)$1 in assets,the firm paid $4.30 of expenses.
D)$1 in fixed assets,the firm generated $4.30 of net sales.

Question

Quizplus · Accepted Answer

The fixed asset turnover ratio is calculated by dividing Net Sales by Average net fixed assets,so a ratio of 4.3 means that for every $1 of fixed assets,the company generated $4.30 of net sales.

A Fixed Asset Turnover Ratio of 4