Compute the capital turnover ratio using total assets

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Question - Zylex Corporation has multiple factories across the United States. The upper management at Zylex evaluates each factory based on the capital turnover ratio from the DuPont system. The following is information for the factory in Pennsylvania for the past year.

Sales $3,600,000

Operating expenses 1,200,000

Total assets (prior to subtracting accumulated depreciation) 8,000,000

Accumulated depreciation 2,000,000

Required -

a. Compute the capital turnover ratio using (1) total assets and (2) assets net of depreciation.

b. Which investment base will the Pennsylvania factory manager prefer?

Reference no: EM132525637

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