Capital Turnover Calculator

Calculate the efficiency of company assets in generating revenue by computing how many times assets are used to generate sales over a period.

Input Parameters

Calculation Results

Calculation Formula

Capital Turnover = Net Sales / Average Net Assets

Where:
Net Sales = Total revenue from sales minus returns, allowances, and discounts
Average Net Assets = (Opening Net Assets + Closing Net Assets) / 2
Opening Net Assets = Total Assets - Total Liabilities at the beginning of the period
Closing Net Assets = Total Assets - Total Liabilities at the end of the period

Capital Turnover Calculator Calculator Usage Guide

Learn how to use the Capital Turnover Calculator calculator and its working principles

How to Use the Capital Turnover Calculator

  1. Enter the Total Assets for the period (the total resources owned by the company).
  2. Enter the Total Liabilities for the period (the total obligations of the company).
  3. Enter the Net Sales for the period (total revenue from sales minus returns, allowances, and discounts).
  4. Click the Calculate button to compute the Average Net Assets and Capital Turnover.
  5. Use the Reset button to clear all input fields and start over.

Understanding Capital Turnover

Capital Turnover is a financial ratio that measures how efficiently a company uses its assets to generate sales. A higher capital turnover ratio indicates that the company is using its assets more efficiently to generate revenue.

Interpreting Results

  • A higher Capital Turnover ratio suggests better efficiency in using assets to generate sales.
  • A lower ratio may indicate that the company is not using its assets efficiently.
  • The ideal ratio varies by industry, so it's best to compare with industry averages.