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Business Definition for: turnover
turnover

frequency with which an item (i.e., fixed asset, inventory, accounts receivable, personnel) is replaced during an accounting period. Assume credit sales of $360,000 and average receivables of $60,000. The number of times receivables turned over for the period is 6 ($360,000/$60,000). In Great Britain, turnover means sales.

turnover

Finance:

  1. number of times a given asset is replaced during an accounting period, usually a year. See also accounts receivable turnover ; inventory turnover .
  2. ratio of annual sales of a company to its networth , measuring the extent to which a company can grow without additional capital investment when compared over a period. See also capital turnover .

Great Britain:annual sales volume.
Industrial relations:total employment divided by the number of employees replaced during a given period.
Securities:volume of shares traded as a percentage of total shares listed on an exchange during a period, usually either a day or a year. The same ratio is applied to individual securities and the portfolios of individual or institutional investors.

turnover

  1. speed of sale of a product measured in terms of the quantity purchased during a period of time. For example, if the owner of a list of one million names rents a total volume of five million names over one year's time, it has a turnover rate of 5. It is important in both retail and direct marketing to evaluate product turnover and price so that selling space, whether it is on a shelf or in a catalog, is used to best advantage. For example, assume Product A has a retail price of $10 and a turnover rate of 100 and Product B has a retail price of $12 and a turnover rate of 70. For the amount of space expended, Product A produces $1000 in revenue and Product B produces $840 in revenue. This indicates that, despite its lower price, Product A, with a high turnover, should be displayed, instead of Product B. On the other hand, if a third product with a turnover of only 1 earns $1500 in revenue, the third product is a better use of the selling space.
  2. number of people tuned to a television or radio program at any one time, divided by the total number of people who tuned to it at all. For example, if 100 people watched part of a television program but only 50 watched it at one point in time, the program has a turnover rate of 50%, indicating that it was not able to hold the viewers' attention to any great extent.

turnover

Finance: (1) number of times a given asset is replaced during an accounting period, usually a year. See also accounts receivable turnover ; inventory turnover ; (2) ratio of annual sales of a company to its net worth, measuring the extent to which a company can grow without additional capital investment when compared over a period.See also capital turnover .
Labor: total employment divided by the number of employees replaced during a given period.
Securities: volume of shares traded as a percentage of total shares listed on an exchange during a period, usually either a day or a year. The same ratio is applied to individual securities and the portfolios of individual or institutional investors, especially mutual funds.

Copyright © 2005, 2000, 1995, 1987 by Barron's Educational Series, Inc., Reprinted by arrangement with Publisher.
Copyright © 2006, 2003, 1998, 1995, 1991, 1987, 1985 by Barron's Educational Series, Inc. Reprinted by arrangement with Publisher.
Copyright c 2000, 1994, 1987 by Barron's Educational Series, Inc. Reprinted by arrangement with Publisher.
Copyright © 2007, 2000, 1997, 1987, by Barron's Educational Series, Inc. Reprinted by arrangement with Publisher.

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