The fixed-asset turnover ratio provides:
A) The rate of decline in asset lives.
B) The rate of replacement of fixed assets.
C) The amount of sales generated per dollar of fixed assets.
D) The decline in book value of fixed assets compared to capital expenditures.

Question

Quizplus · Accepted Answer

The fixed-asset turnover ratio provides the amount of sales generated per dollar of fixed assets. It is calculated as sales divided by average fixed assets. This ratio is useful in determining how efficiently a company is using its fixed assets to generate sales.

The Fixed-Asset Turnover Ratio Provides