asset turnover, asset utilization

(redirected from sales-to-capital-employed ratio)

asset turnover, asset utilization

or

sales-to-capital-employed ratio

a measure of a firm's ASSET turnover, which expresses the firm's sales revenue as a ratio of its size to measure the amount of sales revenue generated by each pound's worth of assets employed in the business. Often total assets are taken as the basis for comparison with sales, though sometimes long-term capital employed is used instead, taking a narrower definition of assets. The asset turnover ratio is often regarded as an important test of business efficiency. Asset turnover has a significant impact upon a firm's RETURN ON CAPITAL EMPLOYED.
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