How Do I Evaluate Asset Turnover?

Asset turnover rate plays an important role in the financial analysis index system. This indicator is defined as the ratio of total turnover to total assets. The analysis of its driving factors generally uses the "asset turnover days" or "asset to income ratio" indicators, and does not use "asset turnover".

Asset turnover

Asset turnover rate is an important measure of corporate asset management efficiency

"Enterprise accounting system" clearly stipulates that the net income of the company's main business should be the amount of the main business income after deducting sales discounts and sales discounts, which is called the net business income. Total asset turnover rate = total sales income / Average total assets × 100%. In the formula, sales revenue is the total sales revenue minus

1. As the annual report only includes

The turnover rate of total assets is an important index for investigating the operational efficiency of an enterprise's assets. It reflects the flow rate of all assets from input to output during the operation of the enterprise, and reflects the management quality and utilization efficiency of all assets of the enterprise. Through the comparative analysis of this indicator, it can reflect the operating efficiency and changes of the total assets of the company this year and previous years, find the gap between the use of assets between the company and similar enterprises, and promote the company to tap the potential, actively generate revenue, increase product market share, increase Asset utilization efficiency. In general, the higher the value, the faster the turnover of the company's total assets. The stronger the sales ability, the higher the asset utilization efficiency.

Asset turnover can be divided into

The numerator in the total asset turnover ratio formula refers to the deducted discounts and discounts.

Asset turnover

Turnover rate of total assets (times) = net operating income / average total assets X100%

Total asset turnover days = 360 ÷ total asset turnover (times)

formula:

Net operating income is the net amount after deducting sales discounts and discounts.

The average total assets refers to the average of the beginning and end of the year. Values taken from the Balance Sheet

Its calculation formula is:

Average total assets = (beginning of total assets + end of total assets) / 2

The turnover rate of total assets is an important indicator for investigating the operating efficiency of an enterprise's assets, and it reflects the total investment

The speed of circulation to output reflects the management quality and utilization efficiency of all assets of the enterprise. Through the comparative analysis of this indicator,

In order to reflect the operating efficiency and changes of the total assets of the company this year and previous years, it is found that enterprises and similar enterprises

Gaps, promote enterprises to tap potential, actively generate revenue, increase product market share, improve asset utilization efficiency, general conditions

The higher the value, the faster the turnover of the company's total assets. ^[2] The stronger the sales ability, the higher the asset utilization efficiency.

Asset turnover

Turnover rate of current assets (times) = main business income / average total current assets X100%

Net income from main operations refers to the amount of income obtained by major sales activities of the company in the current period, such as sales of products, commodities, and labor services, minus discounts and discounts.

Values are taken from the Profit and Profit Allocation Table

The average total current assets refers to the average of the beginning and end of the year of the total current assets of the enterprise. The value is taken from the company's "balance sheet".

Average current total assets = (beginning of current assets + end of current assets) / 2