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melomori [17]
3 years ago
14

vSelected financial data for The Portland Porcelain Works Coffee Mug Division is as​ follows: Sales $ 2 comma 000 comma 000 Oper

ating income $ 400 comma 000 Total assets $ 800 comma 000 Current liabilities $ 120 comma 000 Target rate of return 13​% Weighted average cost of capital 6​% What is The Portland Porcelain Works Coffee Mug Division capital​ turnover?
Business
1 answer:
ioda3 years ago
5 0

Answer:

Capital turnover = 2.5 times

Explanation:

given data

Sales =  $2,000,000

Operating income = $400,000

Total assets = $800,000

Current liabilities = $120,000

Target rate of return = 13​%

Weighted average cost of capital = 6​%

to find out

Portland Porcelain Works Coffee Mug Division capital​ turnover

solution

we get here Portland Porcelain Works Coffee Mug Division capital turnover that is find here by dividing sales by total assets

so

Capital turnover = \frac{sales}{total\ assets}     ......................1

put here value

Capital turnover = \frac{2,000,000}{800,000}

Capital turnover = 2.5 times

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