Asset Turnover Ratio Calculator
Compute the asset turnover ratio by dividing net sales by average total assets.
For informational purposes; consult a financial advisor.
Examples
- $500,000 sales with $250,000 assets ⇒ 2
- $750,000 sales with $300,000 assets ⇒ 2.5
FAQ
What does a higher ratio mean?
Higher values indicate more efficient use of assets.
Can the ratio be below 1?
Yes, which may signal under-utilized assets.
Should I use average assets?
Yes, averaging beginning and ending assets smooths fluctuations.
Additional Information
- Commonly used to evaluate operational efficiency.
- Varies widely by industry.