It is revenue generated by utilizing the asset . It indicates the margins on the assets engaged in the process of production. It is a measure of the efficiency of utilizing the asset base .
Formula Used :
Total asset turnover = Revenue /Assets
It only infers about the sales and not on the profitability of the firm hence it is a different ratio than Return on an asset.
Hence, this concludes the definition of Total Asset Turnover along with its overview.
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