Which of the following transactions would not increase the fixed asset turnover ratio?
A)A profitable sale of inventory on account.
B)A profitable sale of inventory for cash.
C)Selling equipment used in the manufacturing process for a loss.
D)A decrease in cash-based operating expenses.

Question

Quizplus · Accepted Answer

Fixed asset turnover is calculated by dividing net sales by average net fixed assets. A decrease in operating expenses does not affect net sales or average net fixed assets.

Which of the Following Transactions Would Not Increase the Fixed