Top Posters
Since Sunday
10
G
9
I
8
m
8
7
m
7
K
7
6
b
6
L
6
b
6
6
New Topic  
avinash0312 avinash0312
wrote...
Posts: 325
Rep: 7 0
3 months ago
Firm A: Firm B:
Assets Assets
Current assets 4Current assets 7
Fixed assets 10Fixed assets 7
Total assets 14Total assets 14
Firm A:Firm B:
      Total sales12Total sales12
      Cost of sales-5Cost of sales-7
Gross Profit7Gross Profit5

Above are portions of the balance sheet and income statement for two companies in 2008. Based upon this information, which of the following statements is most likely to be true?

▸ Asset turnover ratios indicate that firm A is generating greater revenue per dollar of assets than firm B.

▸ Both asset turnover ratios and fixed asset turnover ratios indicate that firm A is generating greater revenue per dollar of assets than firm B.

▸ Fixed asset turnover ratios indicate that firm A generating more sales for the assets they employ than firm B.

▸ Fixed asset turnover ratios indicate that firm A generating fewer sales for the assets they employ than firm B.
Textbook 

Fundamentals of Corporate Finance


Edition: 2nd
Authors:
Read 67 times
2 Replies
Replies
Answer verified by a subject expert
DryPhantomDryPhantom
wrote...
Posts: 309
3 months ago
Sign in or Sign up in seconds to unlock everything for free.
Fixed asset turnover ratios indicate that firm A generating fewer sales for the assets they employ than firm B.
1

Related Topics

wrote...
3 months ago
Thanks
New Topic      
Explore
Post your homework questions and get free online help from our incredible volunteers.
Learn More
Improve Grades
Help Others
Save Time
Accessible 24/7
  92 People Browsing
 150 Signed Up Today
Related Images
 2521
 455
 96