Asset Turnover Ratio |Accounting
Total asset turnover ratio compares the sales of a company to its asset base. The ratio measures the ability of an organization to efficiently produce sales, and is typically used by third parties to evaluate the operations of a business. Ideally, a company with a high total asset turnover ratio can operate with fewer assets than a less efficient competitor, and so requires less debt and equity to operate. The result should be a comparatively greater return to its shareholders.
Total asset turnover formula
Net sales ÷ Total assets = Total asset turnover
Related topics:
asset utilization ratios,net asset value ,calculate net fixed assets,debt to asset ratio
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