$29.000 $25,000 40.00062,000 59000 50,000 $128,000 137,000 $127,000 120.000 $255

Question

$29.000 $25,000 40.00062,000 59000 50,000 $128,000 137,000 $127,000 120.000 $255,000 $257,000 Cash and Cash Equivalents Accounts Receivable. Net Merchandise Inventory Total Current Assets Property. Plant, and Equipment, Net Total Assets For the year ending December 31. 2019 $520 000 Net Credit Sales Cost of Goods Sold(155,000) Gross Profit $365.000 Calculate the asset turnover ratio for 2019 There are no cash sales (Round your answer to two decimal places.) O A. 406 times B. 2.03 times O c. 1.02 times O D. 061 times

Explanation / Answer

Asset turnover ratio = Net credit sales / Average total asset

Average total asset = (Beginning + Ending) ÷ 2

                                = (255,000 + 257,000) ÷ 2

                                = 512,000 ÷ 2

                                = $256,000

Asset turnover ratio = $520,000 / $256,000

                                    = 2.03

Answer: B

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