A firm's total asset turnover increased from 0.75 to 0.90.Which of the following is TRUE about the given data?

Question

Quizplus · Accepted Answer

Total asset turnover measures the efficiency with which a company is using its assets to generate revenue. An increase in total asset turnover indicates that the company is generating more sales per dollar of assets now than it was before. This is a positive sign for the company as it suggests that the firm is using its assets more efficiently, which can boost profitability. Option B is incorrect as the statement contradicts the definition of total asset turnover. Option C is irrelevant to the given data, and option D is not necessarily true.

A Firm's Total Asset Turnover Increased from 0