Fixed Asset Turnover Ratio Master\'s Communications is a telecommunications comp

Question

Fixed Asset Turnover Ratio

Master's Communications is a telecommunications company. Master's balance sheet disclosed the following information regarding fixed assets:

Master's revenue for Year 2 was $275,287 million. Assume the fixed asset turnover for the telecommunications industry averages approximately 3.16.

a. Determine Master's fixed asset turnover ratio for Year 2. Round to two decimal places.

Year 2
(in millions) Year 1
(in millions) Plant, property, and equipment $224,575 $214,346 Less accumulated depreciation 135,103 127,916 $89,472 $86,430

Explanation / Answer

Dear Student Thank you for using Chegg Please find below the answer Statementshowing Computations Paticulars Amount in m Beginning fixed asset                   86,430.00 Ending fixed asset                   89,472.00 Average Fixed asset (86430 + 89472)/2                 87,951.00 Revenue               275,287.00 fixed asset turnover= 275,287/87,951                            3.13

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