Fixed asset and total asset turnover ratio, Finance Basics

Fixed Asset and Total Asset Turnover Ratio

Fixed asset turnover = Annual Sales / Fixed Assets

  • This ratio indicate the efficiency along with which, the fixed assets were employed to generate sales revenue like a ratio of 1.4 means one shilling of fixed assets was employed to generate Sh.1.4 of sales.

 

Total asset turnover = Annual sales /Total assets

  • The ratio signify amount of sales revenue generated from employment of one shilling of total asset.

 

Posted Date: 1/30/2013 1:51:43 AM | Location : United States







Related Discussions:- Fixed asset and total asset turnover ratio, Assignment Help, Ask Question on Fixed asset and total asset turnover ratio, Get Answer, Expert's Help, Fixed asset and total asset turnover ratio Discussions

Write discussion on Fixed asset and total asset turnover ratio
Your posts are moderated
Related Questions
There are four different commonly used financial hedging techniques and some operational hedging techniques that firms use to manage currency risk. Drawing on literature, critical

Describe the role of insurance companies. Role of Insurance Companies: The main objective of insurance companies is to prevent individuals and firms (termed as policy-hol

Asset Based Valuation - Example K and K Company Limited is planning to absorb three other companies so as to realize its sales records of Sh.500, 000 per annum.  Its accountan

mony is differnt from wealth and income

Determinants of Required Rate of Return 1.Risk free rate - This is the interest rate such would exist on default free securities like Treasury bills and bonds. Risk free

Example of Theoretical Value As a result of the purchase of an asset, the income stream will rise by of £1,000 per annum for 25 years.  By assuming a discount rate of 20 perce

Tests of Term Structure of Interest Rates Theories Various tests have been conducted mainly in USA and they show that all the three (3) theories have some validity and therefo

Determine the Component of Return Rate of return from an investment consists of the two: (i) Yield: Interest or dividend received is called yield. (ii) Capital Appreci

Weighted Average Cost of Capital Weighted Average Cost of Capital or WACC is also called the overall or composite cost of capital. Since various capital components have diffe

Social responsibility - Objectives of Business Entity The firm must decide where to operate strictly in their shareholders' best interests or be responsible to their staff, th