The Jones Company purchased assets costing $214,000 which will be depreciated over 5 years using straight-line depreciation and no salvage value. Jones also purchased land and other assets, which are not depreciable, at a cost of $214,000. It is estimated that in 5 years, the value of these assets will be unchanged. Assume that annual cash profits are $122,000 and, for return on investment (ROI) calculations, the company uses end-of-year asset values. If sales each year average $813,200, what will be the asset turnover using gross book value?

Multiple Choice

• 2.4.

• 2.1.

• 1.4.

• 1.9.