Asset Turnover Ratio

Asset turnover ratio generally used to evaluate company’s performance in a financial year. Asset turnover ratio shows or indicates a company’s efficiency to generate revenues in the form of sales by using available assets.

Asset turnover ratio calculates the value of sales revenue to the available assets during the sales period. Company’s performance is directly proportional to the asset turnover ratio.

How to calculate?

Asset turnover= Sales revenue/ Total assets

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