A good fixed asset turnover ratio depends on the industry, but a ratio of 3:1 or higher is typically considered strong. It shows that a company can earn at least $3 in sales for every $1 spent on ...

Key Takeaways Asset turnover is the ratio of total sales or revenue to average assets. This metric helps investors understand how effectively a company uses assets to generate sales.

The fixed asset turnover ratio is one example. It uses only fixed assets from the balance sheet, focusing on property, plants, and equipment and ignoring intangibles and other types of assets.

The fixed-asset turnover ratio is a measure of whether the money a company spends on the equipment and buildings the company owns, often referred to as property, plant and equipment, or PP&E ...

Your fixed assets should be evaluated in terms of their ability to produce income. Divide your sales by the value of your fixed assets to get your asset-turnover ratio.

A high fixed asset turnover ratio indicates effective utilization of fixed assets, while a low ratio could suggest underperformance or excessive investment in fixed assets.

Sitting at 1.06 today, the fixed asset-turnover ratio is a financial metric used to evaluate how efficiently a company utilizes its fixed assets, such as property, factories, and equipment, to ...