FORMULA

Net Sales / Total Assets ( or average ) or Accounts Receivable, Inventory

MEASURE WHAT

Measure the efficiency of the usage of total assets in generating sales

SCORE/VALUE

Varies.

The higher is the more effective

SALIENT POINTS TO NOTE

Comparing similar periods and similar industry statistics determines measures of efficiencies by which the assets are employed in the business.

This asset utilization ratio forms part of a larger ratio of the Total Return On Assets(ROA) where the quicker the utilization of the total assets means that the enterprise can generate faster returns.