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Wei Corporations sales last year were $945,000, and its year-end total assets were $630,000. The average firm in the industry has a total asset turnover
Wei Corporations sales last year were $945,000, and its year-end total assets were $630,000. The average firm in the industry has a total asset turnover ratio of 2.25. The firms CFO believes the firm has excess assets that can be sold at book value so as to bring the total asset turnover up to the industry average without affecting sales. By how much must the assets be reduced to bring the total asset turnover down to the industry average, holding sales constant? A. $ 35,000 B. $ 77,500 C. $ 140,000 D. $ 210,000 E. $ 393,750
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