Company X has net sales revenue of $1,250,000,cost of goods sold of $760,000,and all other expenses of $290,000.The beginning balance of shareholders' equity is $400,000 and the beginning balance of fixed assets is $361,000.The ending balance of shareholders' equity is $600,000 and the ending balance of fixed assets is $389,000.What is the fixed asset turnover ratio?
A)0.53
B)2.50
C)3.33
D)0.80

Question

Quizplus · Accepted Answer

Average net assets = (Beginning fixed assets + Ending fixed assets)/2 ($361,000 + $389,000)/2 = $375,000
Fixed asset turnover = Net Sales/Average Net Fixed Assets
$1,250,000/375,000 = 3.33.

Company X Has Net Sales Revenue of $1,250,000,cost of Goods