PE 10-9B Fixed asset turnover ratio
Financial statement data for years ending December 31 for Fallon Company are shown below.
|
2012 |
2011 |
|
|
Net sales |
$740,000 |
$520,000 |
|
Fixed assets: |
||
|
Beginning of year |
425,000 |
375,000 |
|
End of year |
500,000 |
425,000 |
a. Determine the fixed asset turnover ratio for 2012 and 2011.
b. Does the change in the fixed asset turnover ratio from 2011 to 2012 indicate a favorable or an unfavorable trend?