Question: What are asset management ratios and how are they used?
Answer:
Asset management, also called asset utilization, ratios tell a small business how well their assets are working to generate sales. Cash is always the best asset but it doesn't generate any revenue. The other assets on your balance do generate sales revenue.
Those other assets are accounts receivable, inventory, and fixed assets. You may also have some other assets on your balance sheet but these are the main ones we use to calculate how efficiently your assets are working for you.
