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Asset turnover (ATO) is measured by Revenue / Average total assets. Assume ATO is currently...

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Accounting

Asset turnover (ATO) is measured by Revenue / Average total assets.

Assume ATO is currently 1.5 times p.a. and that the cash balance remains positive.

State the effect the following event occurring on the reporting date would have on this ratio.

EVENT: The repayment of principal on an interest-only loan

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