Total asset turnover = revenue / total asset
Usually, revenue < total asset
Assume revenue =2, total asset =5, turnover= 2/5=0.4, inventory written down =1
Since COGS is creased by 1, and inventory is decreased by 1, the new revenue will be 1, and the total asset=4
New turnover = 1/4=0.25
The effect should be the turnover will decrease, but the video says it will increase.
Mrs. He says the revenue will remain unchanged but I don't know why
