An Asset Turnover Ratio of 2

question 97

Multiple Choice

An asset turnover ratio of 2.5 means that for every $1 in assets,the firm generates _____ in sales.

• A)$0.50
• B)$2.00
• C)$2.50
• D)$3.00

---

Definitions:

Income Statement

A financial report that shows a company's revenues and expenses over a specified period, culminating in the net profit or loss for that period.

Future Benefit

The expected benefit that will be derived from an investment or action in the future, often used in cost-benefit analyses to evaluate potential projects or investments.

Non-posting Account

A non-posting account is an account used in accounting software for transactions that affect reports or balances without affecting the general ledger.

Accounting System

A systematic process of recording, measuring, and communicating financial information about economic entities.