Asset Turnover Ratio Calculator

Formula

The formula to calculate the asset turnover ratio is:

\[ \text{AT} = \frac{\text{NS}}{\text{TA}} \]

Where:

$\text{AT}$ is the asset turnover ratio
$\text{NS}$ is the total net sales revenue ($)
$\text{TA}$ is the total assets value ($)

What is Asset Turnover Ratio?

Asset turnover ratio is a financial term used to describe the ratio of net sales to total assets. This ratio measures the efficiency at which a company generates sales through its assets.

Example Calculation 1

Let's assume the following values:

Net Sales Revenue (NS) = $500,000
Total Assets Value (TA) = $2,000,000

Using the formula:

\[ \text{AT} = \frac{500,000}{2,000,000} = 0.25 \]

The Asset Turnover Ratio is 0.25.

Example Calculation 2

Let's assume the following values:

Net Sales Revenue (NS) = $1,000,000
Total Assets Value (TA) = $2,500,000

Using the formula:

\[ \text{AT} = \frac{1,000,000}{2,500,000} = 0.40 \]

The Asset Turnover Ratio is 0.40.