Question

The following data were included in a recent Apple Inc. annual report (in millions):

		2013			2014				2015				2016
Net revenue	$	170,910			$	182,795			$	233,715			$	215,640
Net property, plant, and equipment		16,600				20,624				22,471				27,010

Required:

Compute Apple's fixed asset turnover ratio for 2014, 2015, and 2016. (Do not round intermediate calculations. Round your answers to 1 decimal place.)

Answer 1

Note :

Average property, plant, and equipment =( Beginning Balance + Ending Balance ) / 2

• For 2014 : ($16,600 + $20,624 ) / 2 = $18,612
• For 2015 : ($20,624 + $22,471 ) / 2 = $21,547.50
• For 2016 : ($22,471 + $27,010 ) / 2 = $27,740.50

Answer :

Fixed asset turnover ratio : Net revenue / Average  property, plant, and equipment

• For 2014 : $182,795 / $18,612 = 9.8
• For 2015 : $233,715 /  $21,547.50 = 10.8
• For 2016 : $215,640 / $27,740.50 = 7.8