Asset turnover is a financial ratio which calculates the company’s efficacy at using its assets in generating sales or revenue.

Calculator of Total Asset Turnover

Currency =
Sales revenue =
Beginning assets =
Ending assets =
 
Total asset turnover =

Formula of Total Asset Turnover

Total Asset Turnover = Net sales revenue / Average total assets Average total assets = (Beginning assets + Ending assets) / 2

Example of Total Asset Turnover

In 2012 and 2013 a textile company had Rs.960000 and Rs.1690000 in assets respectively. The company generated revenue of Rs.1360000. Calculate the total asset turnover ratio for the company.

Given,

  • Beginning assets = Rs.960000
  • Ending assets = Rs.1690000
  • Sales revenue = Rs.1360000

Solution:
Step 1 :

Average total assets = (Beginning assets + Ending assets) / 2
= (960000 + 1690000) / 2
= 2650000 / 2
= 1325000 Rs

Step 2 :

Total Asset Turnover = Net sales revenue / Average total assets
= 1360000 / 1325000
= 1.026

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