thechainofcommand.net
  • Home
  • Privacy Policy
  • Contact Us
  • Guest Post – Write For Us
  • Sitemap
thechainofcommand.net

What Is an Asset Turnover?

  • Jeffery Williams
  • November 7, 2021
Total
0
Shares
0
0
0

Assets are items that generate revenue for a business, while the business itself generates profits through asset turnover. The more assets an organization has, the greater its profitability will be. This is because of what economists call economies of scale where each new product or service only requires less resources to produce and becomes cheaper to run over time.

The “what is a good asset turnover ratio” is the amount of assets that are generated in a given period of time. Asset Turnover Ratio is calculated by dividing the value of assets at the end of the period by the cost to acquire them during this period.

Sales divided by total assets equals asset turnover. Important for comparing to other businesses in the same industry and over time. This is a common ratio in the business world.

 

The “receivables turnover ratio” is a metric used to measure the amount of money that a company spends on its assets, such as property or equipment.

Frequently Asked Questions

What is a good asset turnover ratio?

A: A good asset turnover ratio is usually between 0.5 and 1.

What does asset turnover indicate?

A: Asset turnover is a measure of the rate at which an asset generates revenue for its owner. It can be calculated by dividing total assets by total liabilities and multiplying it with 100.

What does an asset turnover of 1.57 mean?

A: This means that company ABC has a total asset turnover of 1.57 with an operating margin of 24%.

Related Tags

  • asset turnover formula
  • asset turnover calculator
  • turnover ratio formula
  • asset turnover ratio interpretation
Total
0
Shares
Share 0
Tweet 0
Pin it 0
Jeffery Williams

Previous Article

Ten Tools You Can Start Using Today to Maximize Your Productivity

  • Jeffery Williams
  • November 7, 2021
View Post
Next Article

How to Choose a Pricing Strategy for Your SaaS Startup

  • Jeffery Williams
  • November 7, 2021
View Post
Table of Contents
  1. Frequently Asked Questions
    1. What is a good asset turnover ratio?
    2. What does asset turnover indicate?
    3. What does an asset turnover of 1.57 mean?
    4. Related Tags
Featured
  • 1
    Denise O’Berry Knows Cash Flow
    • March 3, 2022
  • 2
    How to Develop Better Foresight to Combat Chaos
    • March 3, 2022
  • 3
    4 Essentials of the Growth-Oriented Business Plan
    • March 2, 2022
  • 4
    Different Types of Plans for Businesses
    • March 2, 2022
  • 5
    Post-Crisis Digital Trends That Will Reshape Your Business in 2021
    • March 2, 2022
Must Read
  • 1
    Ask a VC
  • 2
    An Easy Way to Increase Your Website Sales
  • 3
    How to Manage Your Business’s Online Reputation
thechainofcommand.net
  • Home
  • Privacy Policy
  • Contact Us
  • Guest Post – Write For Us
  • Sitemap
Stay Updated Always.

Input your search keywords and press Enter.