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Which of the following is not an asset management ratio?

a) A current ratio
b) A total asset turnover ratio
c) A inventory turnover ratio
d) A fixed asset turnover ratio

User Estella
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1 Answer

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Final answer:

The total asset turnover ratio is not an asset management ratio.

Step-by-step explanation:

The correct answer is b) A total asset turnover ratio.

An asset management ratio is a financial ratio that measures how effectively a company is using its assets to generate revenue. These ratios help evaluate a company's ability to manage and utilize its assets efficiently.

The current ratio measures a company's ability to pay off its short-term liabilities using its current assets. The inventory turnover ratio measures the number of times a company sells and replaces its inventory in a given period. The fixed asset turnover ratio measures how efficiently a company is using its fixed assets to generate sales.

However, the total asset turnover ratio measures how efficiently a company is using all its assets, both current and fixed, to generate sales. It is not considered an asset management ratio.

User Manikal
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