- This topic has 1 reply, 2 voices, and was last updated 2 months ago by P2-D2.
- You must be logged in to reply to this topic.
ACCA Webinars: How to earn marks in Strategic Professional Exams. Learn more >>
20% off BPP Books for ACCA & CIMA exams - Get BPP Discount Code >>
I studied on internet and many relaible sights which said that Asset Turnover= Net Sales/Average Number of Assets. However, our book states as AT= Sales/Capital Employed.
Having said that, book definition says that Asset Turnover tells how efficiently organisation assets generated sales. This seems to be even more relatable to formula I food on internet.
Hope you understand!
You need to distinguish between asset turnover and net asset turnover as they are slightly different.
Asset turnover uses total assets as its base, where as net asset turnover uses net assets (=capital employed).
Hope that clears it up for you.