Asset turnover ratio: It is a ratio that measures the productive capacity of the assets to generate the sales revenue for the company. Thus, it shows the relationship between the net sales and the average total assets. The following is the formula to calculate the ratio: Asset turnover ratio = Net Sales Average total assets To Compute: the asset turnover ratio for the Company B for the year 2018.

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Chapter 9, Problem 9.27E

To determine

Asset turnover ratio: It is a ratio that measures the productive capacity of the assets to generate the sales revenue for the company. Thus, it shows the relationship between the net sales and the average total assets. The following is the formula to calculate the ratio:

Asset turnover ratio =Net SalesAverage total assets

To Compute: the asset turnover ratio for the Company B for the year 2018.

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