During 2017, Sanchez Corp. had net sales of $16,400,000. The beginning total assets were $8,900,000. The asset turnover ratio was 1.7 times. Calculate the ending total assets of Sanchez
A) $10,394,118
B) $8,900,000
C) $15,652,941
D) $6,752,941
A .Asset turnover ratio = Net sales / Average total assets
Average total assets = Net sales / Asset turnover ratio
Average total assets = $16,400,000 / 1.7 = 9,647,059
Average total assets = (Beginning assets + Ending assets) / 2
Ending assets = (Average total assets x 2 ) - Beginning assets
Ending assets = ($9,647,059 x 2 ) - $8,900,000 = $10,394,118
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