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| Total Asset Turnover |
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Net Sales
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| Total Asset Turnover =
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Total Assets
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Explanation of Total Asset Turnover:
The Total Asset Turnover is similar to Fixed Asset Turnover,
which both measures a company's effectiveness in generating sales
revenue from investments back into the company. Total Asset Turnover
evaluates the efficiency of managing all of the company's assets.
Importance of Total Asset Turnover:
The higher the Total Asset Turnover is, the more effective use
of the company's investments Total Assets have become. Total Asset
Turnover can be very useful IF you watch what actually makes up the Total
Assets of the company. A company with low inventory and strict credit
policies to keep Accounts Receivable low will help the Total Asset Turnover
look even better. Of course it depends on all of the company's Total
Assets.
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