What is Capital Turnover Ratio? What does it indicate?

What is Capital Turnover Ratio? What does it indicate?


Capital Turnover Ratio indicates the efficiency of the organization with which the capital employed is being utilized. A high capital turnover ratio indicates the capability of the organization to achieve maximum sales with minimum amount of capital employed. Higher the capital turnover ratio better will be the situation.

Formula to calculate capital turnover ratio = Sales/ Capital Employed
Explain Debt Equity Ratio. What are its components? What does it indicate?
Debt Equity Ratio is one of the ratios of solvency group. It indicates the stake of shareholders and creditors in the organization…
What is Proprietary Ratio? What are its components? What does it indicate?
Proprietary Ratio also known as equity ratio indicates the relationship between the owners’ funds and total assets. …
What is Fixed Assets/ Capital Employed Ratio? What does it indicate?
Fixed Assets/ Capital Employed Ratio indicate the extent to which the long term funds are sunk in fixed assets…
Post your comment
Discussion Board
capital turnover ratio
Is there any other formula for
capital turnover ratio.
akash biswas 10-14-2017
CAPITAL EMPLOYED TURNOVER
Don't you think we should use "Average capital employed" instead of Capita Employed at reporting date.
Mubeen Ansari 04-23-2016