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During 2017, Cheyenne Corp. reported net sales of $2900000, net income of $890000, and depreciation expense of $110000. Cheyenne also reported beginning total assets of $1070000, ending total assets of $1300000, plant assets of $680000, and accumulated depreciation of $550000. Cheyenne’s asset turnover (rounded) is

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Answer:

Assets turnover = 2.45

Explanation:

Net sales = $2,900,000

Beginning total assets = $1,070,000

Ending total assets = $1,300,000

Average assets:

= (beginning total assets + ending total assets) ÷ 2

= ($1,070,000 + $1,300,000) ÷ 2

= $1,185,000

Asset turnover = Net sales ÷ Average assets

                          = $2,900,000 ÷ $1,185,000

Assets turnover = 2.45

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