The following data relates to Logan Electric and its Light Bulb Division. What is the Light Bulb Division's capital turnover?
A)10.0
B)4.0
C)2.5
D)5.5

Question

The following data relates to Logan Electric and its Light Bulb Division.  What is the Light Bulb Division's capital turnover?
A)10.0 
B)4.0 
C)2.5 
D)5.5

Quizplus · Accepted Answer

The formula for capital turnover is net sales / average total assets. 
From the provided information, we can determine that the net sales for the Light Bulb Division are $200 million and the average total assets are $80 million. 
Therefore, the capital turnover for the Light Bulb Division is 2.5 ($200 million / $80 million). 
The correct answer is C.

The Following Data Relates to Logan Electric and Its Light