Selected data from Division A of Green Company are as follows:
$\begin{array}{lcc}
\text { Sales } & \$ & 500,000 \
\text { Average investment } & \$ & 300,000 \
\text { Operating income } & \$ & 60,000 \
\text { Minimum rate of return } & & 15 \%
\end{array}$Division A's asset turnover (AT) is (rounded):
A)0.72.
B)1.00.
C)1.58.
D)1.67.
E)2.08.

Question

Quizplus · Accepted Answer

Asset Turnover (AT) is calculated as Sales divided by Average Investment. Here, AT = $500,000 / $300,000 = 1.67.

Selected Data from Division a of Green Company Are as Follows