Total Asset Turnover -Net sales / Revenue divided by Average Total Cost
Explanation:
Total Asset turnover helps to know :-
1. Financial Condition - Which means how much profit the company has earned and what are there Retained Earnings.
2. Desirable Ratios - Depending upon the company type and size ratios are decided which helps them to make a standard comparison.
Total Asset turnover helps to compare the efficiency of the company through figures which would give them a direction to increase there sales volume.
