Essay
A firm has sales of $5 million, average total assets of $1.6 million, average fixed assets of $1 million, and average current liabilities of $300,000. Given this information, answer the following about the firm's efficiency:
a. Calculate asset turnover, fixed asset turnover, and NWC turnover ratios.
b. Can the fixed asset turnover be considered appropriate and yet the total asset turnover be considered low by industry standards? How?
c. What in general might improve NWC turnover?
Correct Answer:
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b. This can occur if the average lev...View Answer
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Correct Answer:
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b. This can occur if the average lev...View Answer
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