Brief Exercise 8-12 Analyze Fixed Assets

In its annual report, Phono Corporation reported beginning total assets of $360,000, ending total assets of $406,000, beginning fixed assets of $300,000 (at cost), ending fixed assets of $311,000 (at cost), ending accumulated depreciation of $106,000, depreciation expense of $16,500, and net revenues of $120,000.

Required:

Calculate Phono's fixed asset turnover ratio for the year and its average useful life and age of fixed assets at year-end. Round the answer for the fixed asset turnover ratio to two decimal places. Round the answer for the average useful life of fixed assets and the average age of fixed assets to one decimal place.

Fixed asset turnover ratio
Average useful life of fixed assets	years
Average age of fixed assets	years Check My Work Feedback Several subtotals must be calculated to obtain the needed values for the fixed asset turnover ratio, which equals total revenues average net book value* of fixed assets. *Average net book value = (Beginning net book value + Ending net book value) 2 Other points to remember: Recall that net book value is the fixed asset cost minus accumulated depreciation. Also remember that ending accumulated depreciation current year depreciation expense = beginning accumulated depreciation. Average useful life of fixed assets is equal to ending cost of fixed assets divided by current year depreciation expense. Average age of fixed assets = ending accumulated depreciation current year's depreciation expense. THE ANSWERS ARE NOT .57 TIMES, 19 YEARS, AND 6 YEARS