# What is my asset turnover?

Computes the total asset turnover ratio: net sales ÷ average total assets.

- Page: https://www.acalculator.org/finance/asset-turnover-calculator
- JSON spec: https://www.acalculator.org/finance/asset-turnover-calculator.json
- Version: 266e80795e53

## Default answer

Example with the default inputs (Net sales $120,000.00, Total assets at the start $200,000.00, Total assets at the end $250,000.00): Net sales of $120,000.00 on average total assets of $225,000.00 give an asset turnover of 0.53.

## Inputs

| Key | Label | Description |
| --- | --- | --- |
| sales | Net sales | Sales for the year after returns, allowances and discounts. |
| bta | Total assets at the start | Total assets at the start of the year. Leave empty to use the ending total alone. |
| eta | Total assets at the end | Total assets at the end of the year. |

## Outputs

| Key | Label | Description |
| --- | --- | --- |
| turnover | Asset turnover | Net sales ÷ average total assets: the sales made for each $1 of assets. |
| average | Average total assets | (Beginning + ending total assets) ÷ 2, or the ending total when no beginning is given. |

## Method

Average total assets = (beginning total assets + ending total assets) ÷ 2 (ending alone when no beginning is given). Asset turnover = net sales ÷ average total assets.

## Assumptions

- Net sales cover the year the two balance sheets start and end.
- Arithmetic is exact on the typed decimals; the ratio shows to 2 decimals, halves up.

## Worked examples

1. sales = $120,000.00, bta = $200,000.00, eta = $250,000.00 gives turnover = 0.533333, average = $225,000.00. Source: OpenStax, Principles of Finance, 6.2 Operating Efficiency Ratios (total asset turnover = net sales ÷ average total assets; Clear Lake Sporting Goods, 0.53 times). https://openstax.org/books/principles-finance/pages/6-2-operating-efficiency-ratios: 120,000 ÷ ((200,000 + 250,000) ÷ 2) = 0.53 times (rounded).
2. sales = $2,000,000.00, bta = $900,000.00, eta = $1,100,000.00 gives turnover = 2, average = $1,000,000.00. Source: OpenStax, Principles of Finance, 6.2 Operating Efficiency Ratios (total asset turnover = net sales ÷ average total assets; Clear Lake Sporting Goods, 0.53 times). https://openstax.org/books/principles-finance/pages/6-2-operating-efficiency-ratios.
3. sales = $120,000.00, eta = $250,000.00 gives turnover = 0.48.

## FAQ

### What is asset turnover?

Total asset turnover shows how well a company uses its assets to make sales. A turnover of 2 means $2 of sales a year for every $1 of assets.

### How do I calculate asset turnover?

Divide net sales by the average total assets. The average is the starting total plus the ending total, divided by 2. Clear Lake Sporting Goods had $120,000 of net sales and total assets of $200,000 and $250,000, so its turnover was 120,000 ÷ 225,000 = 0.53.

### What is a good asset turnover ratio?

It depends on the business. Grocers and other retailers sell a lot from few assets and often turn over 2 or more. Utilities and factories need large plants and often turn over less than 1. Compare with similar companies and with past years.

### Why use average total assets?

Sales are made over the whole year, but total assets are a balance on one day. The average of the two balances matches the year better. If you have only one balance sheet, leave the starting total empty and the calculator uses the ending total.

### How does asset turnover fit into ROE?

In the DuPont method, return on equity is the profit margin times total asset turnover times the equity multiplier. A higher asset turnover lifts ROE when margins and leverage stay the same.

## Sources

- OpenStax, Principles of Finance, 6.2 Operating Efficiency Ratios: total asset turnover = net sales ÷ average total assets, average = (beginning + ending) ÷ 2, and the Clear Lake Sporting Goods example (0.53 times, rounded). https://openstax.org/books/principles-finance/pages/6-2-operating-efficiency-ratios (retrieved 2026-10-18)
- OpenStax, Principles of Finance, 6.6 Profitability Ratios and the DuPont Method: ROE = profit margin × total asset turnover × equity multiplier. https://openstax.org/books/principles-finance/pages/6-6-profitability-ratios-and-the-dupont-method (retrieved 2026-10-18)