Investment Turnover Equation

Capital turnover is the measure that indicates organization s efficiency in relation to the utilization of capital employed in the business and it is calculated as a ratio of total annual turnover divided by the total amount of stockholder s equity also known as net worth and the higher the ratio the better is the utilization of capital employed. In order to calculate the investment turnover ratio you can use the following formula.

Roi Return On Investment Definition Formula Calculation Ionos

Net sales stockholders equity debt outstanding investment turnover ratio.

Investment turnover equation. Investment turnover ratio sales revenue shareholders equity debt outstanding debt outstanding includes both long term debt and short term debt such as the current portion of long term debt and short term liabilities. Turnover dfrac 8 000 700 900 5 investmentturnover 700 9008 000. Inferring the investment strategy through the portfolio turnover ratio.

A fund prefers an investment strategy of capitalizing on changing market conditions. The fund s portfolio turnover ratio was reported to be 95. Lmo limited has an investment turnover ratio of 5 and this means that for every 1 invested into the company it generated 5 in revenue.

The formula for the investment turnover ratio is to divide net sales by all stockholders equity and outstanding debt. The portfolio turnover ratio for the fund is calculated as 8m 50m x 100 16.

Solved The Total Assets For This Company Equal 174 000 Chegg Com