Asset Turnover Ratio Calculator | Sample Business Plan
Asset Turnover Ratio Calculator
Asset Turnover Formula
Asset Turnover =
Revenue / Total Assets
What is Asset Turnover?
Asset Turnover is used by companys to evaluate how efficient it is at using its assets to generate revenue. The higher the number the better the company is doing. It is also used as an indirect measure to evaluate the company's pricing strategy. If the company has a high turnover rate, it is typically an indication that they have low profit margins; and a lower turnover rate generally indicates high profit margins. This is somewhat intuitive as higher profit margins will affect the velocity of the product (it will sell slower), while lower profit margins will have a higher velocity and sell faster.
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