Question

Please refer to Table 4-1 for the following questions. Table 4-1 Stewart Company Balance Sheet Assets Cash and marketable securities Accounts receivable Inventories Prepaid experte Total current assets Foxed as 8,000,000 Less acom dep: (2,075,000 Netfbced as Total $500,000 900,000 1,500,000 75,000 $3,075,000 $5925000 59,000,000 ACCOUNG pava Notes payable S800.000 700.000 50.000 $1.550.000 2.500.000 Accrued taxes Total current liabilitie Long-term debt Ownersequity (1 million shares of common stock outstanding) Total tubdities and owner's equity 4950.000 $9.000.000 $10.000.000 (3.000.000 (2.000.000 Net sales (all credit) Lese Cost of goods sold Selling and administrative expe Deprecation expense Interest expense E s before taxes Incore treces a Net income 200,000) 4550.000 (1.520,000) $2.730.000 Based on the information in Table 4-1, the total asset turnover ratio is

Answer 1

Calculate total assets turnover ratio as follows:

Total assets turnover ratio = Sales/total assets

Total assets turnover ratio = $10,000,000/$9,000,000

Total assets turnover ratio = 1.11 times.