Need to compute an asset turnover ratio using the attached annual consolidated i

Question

Need to compute an asset turnover ratio using the attached annual consolidated income statement and balance sheet for the most recent 2 years. Thanks!

TRACTOR SUPPLY COMPANY CONSOLIDATED STATEMENTS OF INCOME (in thousands, except per share amounts) Fiscal Year 2015 2014 2013 S 6,226,507 S 5,711,715 5,164,784 4,083,333 3,761,300 3.411,175 1,753,609 1,369,097 1246,308 1,138,934 100,025 514,650 557 514,093 185,859 S 410,395 S 370,885 S 328,234 2.35 2.32 Net sales Cost ofmerchandise sold Gross profit 2,143,174 1,950,415 Selling, general and administrative expenses 123,569 650,508 2,891 647,617 237,222 114,635 589,472 1,885 587,587 216,702 Depreciation and amortization Operating income Interest expense, net Income beforeincome taxes Income tax expense Net income Net income per share -basi

Explanation / Answer

Answer:

Asset turnover ratio = Net Sales / Average Total Assets

Average Total Asset = (Beginning balance + Ending Balance) / 2 = (2,370, 826 + 2,034,571) / 2 = $2,202,698.50

Asset Turnover Ratio = 6,226,507 / 2,202,698.50 = 2.83

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