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1. Introduction to Accounting1h 21m
2. Transaction Analysis1h 13m
3. Accrual Accounting Concepts2h 38m
4. Merchandising Operations2h 30m
5. Inventory1h 55m
6. Internal Controls and Reporting Cash1h 16m
7. Receivables and Investments3h 8m
8. Long Lived Assets5h 1m
9. Current Liabilities2h 19m
10. Time Value of Money1h 23m
- Time Value of Money Equations
  35m
- Using Time Value of Money Tables
  47m
11. Long Term Liabilities2h 45m
12. Stockholders' Equity2h 15m
13. Statement of Cash Flows2h 24m
14. Financial Statement Analysis5h 25m
15. GAAP vs IFRS56m

14. Financial Statement Analysis

Ratios: Fixed Asset Turnover

Financial Accounting

14. Financial Statement Analysis

Ratios: Fixed Asset Turnover

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Multiple Choice

ABC Company had $200,000 in Net Sales and Gross Profit of $80,000. If Fixed Assets equaled $400,000, what is the Fixed Asset Turnover ratio?

0.2

0.5

2.0

2.5

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Verified step by step guidance

Understand the Fixed Asset Turnover ratio formula: Fixed Asset Turnover = Net Sales / Average Fixed Assets.

Identify the given values from the problem: Net Sales = $200,000 and Fixed Assets = $400,000.

Since the problem does not mention any changes in Fixed Assets, assume that the beginning and ending Fixed Assets are the same, making the Average Fixed Assets = $400,000.

Substitute the given values into the Fixed Asset Turnover formula: Fixed Asset Turnover = $200,000 / $400,000.

Simplify the expression to find the Fixed Asset Turnover ratio.