Question

Deflorio corporation's inventory at the end of year 2 was $168,000 and its inventory at the end of year 1 was $153,000. the company's total assets at the end of year 2 were $1,481,000 and its total assets at the end of year 1 were $1,424,000. sales amounted to $1,460,000 in year 2. the company's total asset turnover for year 2 is closest to:

Answer 1

Hi there

Total assets turnover=sales÷average total assets

Average total assets
(1,481,000+1,424,000)÷2=1,452,500

So total assets turnover is
1,460,000÷1,452,500=1.01...answer

Hope it helps