Darden Restaurants, Inc., is a full-service restaurant company, including brands such as Olive Garden, Long- Horn Steakhouse, and Bahama Breeze. The company’s fixed-asset turnover ratio, using the average book value of property, plant, and equipment (PP&E) as the denominator, was approximately 2.94. Additional information taken from the company’s annual report is as follows:

Required:
1. How is the fixed-asset turnover ratio computed? If the industry average ratio is 4.0, would Darden’s ratio be considered more or less favorable?
2. Use the data to determine Darden’s net sales for the year.

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Book value of PP&E-beginning of the year Net purchases of PP&E during the year* Depreciation of PP&E for the year ($ in millions) $2,552.6 454.1 249.8 *Net purchases include book value of equipment purchased minus book value of equipment sold.