Asset turnover measures how efficiently assets are used to produce sales.

Question

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Asset turnover is a financial ratio that measures how effectively a company uses its assets to generate revenue. By dividing the company's sales by its total assets, this ratio shows how effectively a company is using its assets to produce revenue. A higher asset turnover ratio implies that a company is using its assets more efficiently to generate revenue.

Asset Turnover Measures How Efficiently Assets Are Used to Produce