The Fixed Asset Turnover Calculator is used to calculate the fixed asset turnover ratio.
In business, fixed asset turnover is the ratio of sales (on the profit and loss account) to the value of fixed assets (property, plant and equipment or PP&E, on the balance sheet). It indicates how well the business is using its fixed assets to generate sales. The higher the ratio, the better, because a high ratio indicates the business has less money tied up in fixed assets for each unit of currency of sales revenue. A declining ratio may indicate that the business is over-invested in plant, equipment, or other fixed assets.
The Fixed Asset Turnover Ratio calculation formula is as follows:
Fixed Asset Turnover = Net Sales / Average Net Fixed Assets