term1 Definition1term2 Definition2term3 Definition3
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Working Capital Turnover
Sales/Working Capital
. Where Working Capital= Current Assets less Current Liabilities
. The more the ratio the better.
Fixed Assets Turnover Ratio
. Measures how efficiently the company is deploying its investment in net property, plant and equipment to generate revenues.
. Net Sales/ Average Property, Plant and Equipment
. A higher the better
. Affected by the depreciation method used.
Total Assets Turnover Ratio
. How efficiently the company is deploying the totally of its resources to generate revenues.
. A higher turnover implies effective use of net assets to generate sales.
. Certain assets, for example , investments, do not relate to net sales. Their inclusion decreases the ratio.
. Net Sales/ Average Total Assets
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