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How do I calculate asset turnover ratio? During January 2024 , the following transactions occurred: January1January4January8January15Receivedcashonaccountsreceivable,$22,500January19Paidcashforsalaries,$30,300.January28PaidcashforJanuaryutilities,$17,000.January30FireworksalesforJanuarytotaled$225,000.Allofthesesaleswereonaccount.Thecostoftheunitssoldwas$117,500.Purchasedequipmentfor$20,000.Thecompanyestimatesaresidualvalueof$2,000andafour-yearservicelife.Paidcashonaccountspayable,$10,000.Purchasedadditionalinventoryonaccount,$87,900. The following information is available on January 31, 2024.
How do I calculate asset turnover ratio?
During January 2024 , the following transactions occurred: January1January4January8January15Receivedcashonaccountsreceivable,$22,500January19Paidcashforsalaries,$30,300.January28PaidcashforJanuaryutilities,$17,000.January30FireworksalesforJanuarytotaled$225,000.Allofthesesaleswereonaccount.Thecostoftheunitssoldwas$117,500.Purchasedequipmentfor$20,000.Thecompanyestimatesaresidualvalueof$2,000andafour-yearservicelife.Paidcashonaccountspayable,$10,000.Purchasedadditionalinventoryonaccount,$87,900. The following information is available on January 31, 2024. a. Depreciation on the equipment for the month of January is calculated using the straight-line method. b. The company records an adjusting entry for $3,550 for estimated future uncollectible accounts. c. The company has accrued interest on notes receivable for January. Interest will be received each December 31. d. Unpaid salaries owed to employees at the end of January are $33,100. e. The company accrued income taxes at the end of January of $9,500. (c) Calculate the asset turnover ratio for the month of January. If the industry average asset turnover is 0.5 times per month, is the company more or less efficient at producing revenues with its assets than other companies in the same industryStep by Step Solution
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