Answer (D) is correct . The asset turnover ratio equals $1,800,000 of net sales divided by $1,200,000 of average total assets. The asset turnover ratio is therefore equal to 1.5.
Answer (A) is incorrect because Asset turnover equals net sales divided by average total assets.
Answer (B) is incorrect because Asset turnover equals net sales divided by average total assets.
Answer (C) is incorrect because Asset turnover equals net sales divided by average total assets.
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The company’s asset turnover ratio for the year is
