During 2021, Rathke Corporation reported net sales of $3,000,000, net income of $1,200,000, and depreciation expense of $100,000.Rathke also reported beginning total assets of $1,000,000, ending total assets of $1,500,000, plant assets of $800,000, and accumulated depreciation of $500,000.Rathke's asset turnover is

Question

Quizplus · Accepted Answer

Asset turnover is calculated as Net Sales / Average Total Assets. Average Total Assets = (Beginning Total Assets + Ending Total Assets) / 2 = ($1,000,000 + $1,500,000) / 2 = $1,250,000. Thus, Asset Turnover = $3,000,000 / $1,250,000 = 2.4 times.

During 2021, Rathke Corporation Reported Net Sales of $3,000,000, Net