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File Edit View History Bookmarks People Window Help Secure https://newconnect.mheducation.com/flow/connect.html am 3 (Chapters 6,7,8) Saved A total asset turnover ratio of 2.6 indicates that: 12 Multiple Choice ints Ro5)For every $1 in ssets,t h fim earned $26 in net income For every $1 in assets, the firm earned gross profit of $2.6 during the period For every $1 in assets, the firm paid $2.6 in expenses during the period. For every $1 in assets, the firm produced $2.6 In net sales during the period. 2

Explanation / Answer

Asset turnover ratio = net sales/average total assets.

Now, 2.6 = net sales/average total assets

Or, average total assets*2.6 = net sales

This means that “for every $1 in assets, the firm produced $2.6 in net sales during the period”.

Thus the answer is the 4th option.

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