Gracie Human Resource Consulting has total revenue of $285,400, cost of goods sold equal to 68 percent of sales, and a profit margin of 9.2 percent.Net fixed assets are $126,400 and current assets are $65,880.What is the total asset turnover rate?
A)1.01
B)1.30
C)1.48
D)1.84
E)4.81

Question

Quizplus · Accepted Answer

Total asset turnover rate = Sales / Total assetsTotal assets = Net fixed assets + Current assetsTotal assets = $126,400 + $65,880 = $192,280Sales = Total revenue / (1 - Cost of goods sold / Sales)Sales = $285,400 / (1 - 0.68) = $900,000Total asset turnover rate = $900,000 / $192,280 = 1.48

Gracie Human Resource Consulting Has Total Revenue of $285,400, Cost