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Date: 2014-07-25
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Asset Turnover

 
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The metric Asset Turnover says something about how many assets a company had to invest to reach a certain activity in sales. It says something about how productive and efficient a company has been, and how efficiently it has used its assets in generating revenues. The Asset Turnover Ratio basically measures the amount of sales or revenues generated for every dollar invested in assets.

The formula for Asset Turnover Ratio is:

Asset Turnover = Sales / Assets

Asset Turnover should of course be as high as possible. Investors might see a high Asset turnover as advantageous, and as an indication of that the company is using its assets efficiently.

 
 
 
 
 
Date Created: 2009-11-18
Posted by: Admin
 
 
 

Related resources:

Return on Investment (ROI)
Return on Assets (ROA)
Return on Equity (ROE)
Return on Sales (ROS)
Return on Capital Employed (ROCE)
Contribution Margin and Contribution Margin Ratio
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Keywords:
Online MBA, Online MBA Courses, Asset Turnover, calculation, example, formula

 


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