The Ratio Measuring the Number of Dollars of Sales Earned

question 169

Multiple Choice

The ratio measuring the number of dollars of sales earned per dollar of fixed assets is the

• A) fixed asset turnover ratio
• B) days' in assets ratio
• C) current asset turnover ratio
• D) intangible asset ratio

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Definitions:

Contra Account

An account used in accounting to reduce the value of a related account when the two are netted together, providing a clearer picture of financial status.

Fair Value

An estimate of the market value of an asset or liability, based on current prices in active markets.

Noncash Asset

An asset that is not cash or does not directly translate into cash in a short period, such as property, plant, and equipment.

Corporation

A legal entity that is separate and distinct from its owners, who are shareholders, and has its own rights and obligations.