During 2014, Stein Corporation Reported Net Sales of $5,000,000 and Net

question 284

Multiple Choice

During 2014, Stein Corporation reported net sales of $5,000,000 and net income of $2,250,000. Stein also reported beginning total assets of $1,000,000 and ending total assets of $1,500,000. Stein's asset turnover ratio is

• A) 5.0 times.
• B) 4.0 times.
• C) 3.4 times.
• D) 2.4 times.

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Definitions:

Financial Accounting

The field of accounting that focuses on recording, summarizing, and reporting the myriad of transactions resulting from business operations over a period of time.

Goodwill

An intangible asset that represents the excess value of a purchased company over the fair value of its identifiable net assets.

Amortize

The gradual reduction of a debt over a period of time through regular payments of principal and interest sufficient to pay off the debt by maturity.

GAAP

Generally Accepted Accounting Principles, a set of accounting standards and procedures used in the United States to guide the recording and reporting of financial information.