Question

"Maple Corp. had net sales of​ $217,550 for the year ended December​ 31, 2017. Its beginning and ending total assets were​ $94,200 and​ $113,500, respectively. Determine​ Maple's asset turnover ratio for the year ended December​ 31, 2017.​ (Round your answer to two decimal​ places.)"

Answer 1

To find the asset turnover ratio, divide the net sales by the average total assets. In this case, the ratio is approximately 2.09.

Step-by-step explanation:

To find Maple Corp.'s asset turnover ratio, we need to divide the net sales by the average total assets. The formula for asset turnover ratio is:

Asset Turnover Ratio = Net Sales / Average Total Assets

We can calculate the average total assets by adding the beginning and ending total assets and dividing the sum by 2:

Average Total Assets = (Beginning Total Assets + Ending Total Assets) / 2

Using the given information:

Average Total Assets = ($94,200 + $113,500) / 2 = $103,850

Now we can plug the values into the formula:

Asset Turnover Ratio = $217,550 / $103,850

Calculating the ratio:

Asset Turnover Ratio ≈ 2.09

Therefore, Maple Corp.'s asset turnover ratio for the year ended December 31, 2017 is approximately 2.09.