Asked by
Brenda Shelley
on Oct 28, 2024
Verified
Which of the following statements is inaccurate with respect to the total asset turnover ratio?
A) The ratio is calculated as sales revenues divided by total assets at year-end.
B) The ratio is decreased when additional plant and equipment is purchased.
C) A high ratio implies efficient management of assets.
D) The ratio is decreased when additional inventory is purchased.
Sales Revenues
Sales revenues represent the total amount of money earned by a company from its sales of goods or services before any expenses are deducted.
Plant Equipment
Assets that are durable and used in operations to produce goods and services, typically including machinery, vehicles, and tools.
- Understand the calculation and implication of financial ratios such as total asset turnover and earnings per share.
Verified Answer
NR
Learning Objectives
- Understand the calculation and implication of financial ratios such as total asset turnover and earnings per share.