Learn what asset turnover ratio is, the formula, how to calculate it and how it measures a company's efficiency in generating ...

The fixed asset turnover ratio is calculated by dividing net sales by the average balance in fixed assets. A higher ratio implies that management is using its fixed assets more effectively.

The asset turnover ratio measures the value of a company's sales or revenues generated relative to the value of its assets.

The fixed asset turnover ratio measures how efficiently a company is generating net sales from its fixed-asset investments.

Asset Turnover Ratio Example As an example of how the asset turnover ratio is applied, consider the net sales and total assets of two fictional retail companies.

Asset turnover is the ratio of total sales to average assets, and it's used to help investors figure out how effectively a company is using its assets to create revenue.

To calculate your company's asset turnover ratio for a given period, such as a year or a quarter, divide your total sales revenue for the period by your average total assets for the period. The ...

In the example above, the reciprocal of the 0.5 capital intensity ratio is 1 divided by 0.5, or 2 -- the total asset turnover. Likewise, the reciprocal of the asset turnover ratio is the capital ...

One of the most important questions for investors is how efficiently a company uses its assets to generate revenue. This information is not readily found in the most common financial reports, such ...

Learn what asset turnover ratio is, the formula, how to calculate it and how it measures a company's efficiency in generating revenue from its assets.