formula directory logo

HOSTING A TOTAL OF 318 FORMULAS WITH CALCULATORS

Asset Turnover Ratio

The formula for the asset turnover ratio evaluates how well a company is utilizing its assets to produce revenue. The numerator of the asset turnover ratio formula shows revenues which is found on a company's income statement and the denominator shows total assets which is found on a company's balance sheet.

It should be noted that the asset turnover ratio formula does not look at how well a company is earning profits relative to assets. The asset turnover ratio formula only looks at revenues and not profits. This is the distinct difference between return on assets (ROA) and the asset turnover ratio, as return on assets looks at net income, or profit, relative to assets.

s a

Here,s=sales revenue,a=total assets

ENTER THE VARIABLES TO BE USED IN THE FORMULA