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Deflorio Corporation’s inventory at the end of Year 2 was $182,000 and its inventory at the end of Year 1 was $171,000. The company’s total assets at the end of Year 2 were $1,556,000 and its total assets at the end of Year 1 were $1,458,000. Sales amounted to $1,600,000 in Year 2.The company’s total asset turnover for Year 2 is closest to:

Respuesta :

TomShelby

Answer:

sales turnover = 1.062

Explanation:

[tex]sales \: TO = \frac{sales}{average \: cost}[/tex]

where:

[tex]avg \: assets = (beginning+ending) \div 2[/tex]

1,458,000+1,556,000 = 1,507,000 average assets

1,600,000/1,507,000 = 1.061712011 = 1.062

The inventory is irrelevant for the calculation.

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