Question

A company had average total assets of $932,000. Its gross sales were $1,097,000 and its net sales were $965,000. The company's total asset turnover equals:

Answer 1

Answer:

Total asset turnover is 1.035.

Explanation:

The total assets that the company had = $932000

Gross sales = $1097000

Net sales = $965000

The total asset turnover can be determined by dividing the net sales with average total assets. Here, the average total assets are $932000 and net sales is $965,000.  

Total asset turnover = net sales / average total assets

= 965000 / 932000

=1.035