Chapter 5, Problem 5.4ADM

J. C. Penney: Asset turnover ratio

J. C. Penney Company, Inc. is a large general merchandise retailer in the United States. The following data were obtained from its financial statements for four recent years:

	Year 4	Year 3	Year 2	Year 1
Total sales	$12,257	$11,859	$12,985	$17,260
Total assets:
Beginning of year	11,801	9,781	11,424	13,068
End of year	10,404	11,801	9,781	11,424

• A. Compute the asset turnover ratio for each year. (Round to two decimal places).
• B. Plot the asset turnover ratio on a line chart with the year on the horizontal axis.
• C. Interpret the trend in this ratio over the four years.