The product of average total assets and the asset turnover ratio isSelect answer from the options belowprofit.profit margin.return on assets.net sale

To solve this problem, we will analyze the relationship between the average total assets, the asset turnover ratio, and how these define one of the specified financial metrics.

Break Down the Problem

1. We have average total assets.
2. We have the asset turnover ratio.
3. We want to find out what the product of these two values represents from the given options.

Relevant Concepts

The asset turnover ratio measures how efficiently a company uses its assets to generate sales. It is defined as: $\text{Asset Turnover Ratio} = \frac{\text{Net Sales}}{\text{Average Total Assets}}$

By rearranging this formula, we can express Net Sales as: $\text{Net Sales} = \text{Asset Turnover Ratio} \times \text{Average Total Assets}$

Analysis and Detail

• The product of average total assets and the asset turnover ratio gives us net sales.
• This result directly correlates with the formula for asset turnover and confirms that net sales are generated from the efficient use of assets.

Verify and Summarize

We can verify that: $\text{Net Sales} = \text{Asset Turnover Ratio} \times \text{Average Total Assets}$ Therefore, it confirms that the product of average total assets and asset turnover equals net sales.

Final Answer

The product of average total assets and the asset turnover ratio is net sales.