Question

Your company has net sales revenue of $49 million during the year. At the beginning of the year, fixed assets are $21 million. At the end of the year, fixed assets are $23 million. What is the fixed asset turnover ratio

Answer 1

The fixed asset turnover ratio is 2.13 times.

Step-by-step explanation:

Fixed Assets Turnover Ratio = Sales / Total Fixed Assets

= $49 million / $23 million

= 2.13 times

Note that we use the end of year balances for fixed assets in the calculation of fixed asset turnover ratio.

Conclusion :

The fixed asset turnover ratio is 2.13 times.