Freda's, Inc. has sales of $3,200, current liabilities of $900, total assets of $3,000, and net working capital of $500. How many dollars' worth of sales are generated from every $1 in net ﬁxed assets?

Question

Quizplus · Accepted Answer

To find the sales generated from every $1 in net fixed assets, first calculate net fixed assets: Total assets ($3,000) minus current assets ($900 + $500) equals $1,600. Then, divide sales ($3,200) by net fixed assets ($1,600) to get $2.00.