Problem:
Jim Short's Company makes clothing for schools. Sales in 2013 were $4,820,000. Assets were as follows: Cash ($163,000), Accounts receivables ($889,000) Inventory ($411,000) Net equipment ($520,000) Total assets ($1,983,000):
Required:
a. Compute the following: Accounts receivable turnover, Inventory turnover, fixed asset turnover, and Total asset turnover.
b. In 2014, sales increased to $5,740,000 and the assets for that year were as follows; Cash ($163,000), Accounts receivables ($924,000),
Inventory ($1,063,000), Net equipment ($520,000), Total assets ($2,670,000).
Compute the four ratios.
C. is there an improvement or a decline in total asset turnover, and based on the other ratios, indicate why this development has taken place.
Please provide step by step solution and also show all work.