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Finance / July 14, 2018 / Alejandra Tanner

Fixed assets are also known as Infrastructure Assets, which can include road signs, bridges, tunnels, water and sewer systems, dams and lighting systems, land, buildings, equipment and machinery. Fixed assets differ from moveable assets in that fixed assets are fixed in place, typically attached or connected to a building, while moveable assets are not. Fixed assets are not inventory or items available for resale, but are company property often used in the course of conducting business.

There are a number of variants of the ratio like total asset turnover ratio, fixed asset turnover ratio and working capital turnover ratio. In all cases the numerator is the same i.e. net sales (both cash and credit) but denominator is average total assets, average fixed assets and average working capital respectively.

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