Which measure indicates how efficiently a company is using its assets to generate sales?

Asset Turnover is the measure that indicates how efficiently a company is using its assets to generate sales. It is calculated by dividing the total sales revenue by the average total assets for a period. This ratio provides insight into how effectively a company is utilizing its assets to produce revenue. A higher asset turnover ratio signifies that the company is using its assets more efficiently in generating sales, which is a key indicator of operational efficiency.

This measure focuses specifically on the relationship between sales and asset utilization, offering valuable information for assessing how well a business is converting its investments in assets into revenue. In contrast, the other options are related to different aspects of financial performance: Gross Profit Margin assesses profitability relative to sales, Return on Owners Investment focuses on returns to equity holders, and Stock Turnover analyzes how quickly inventory is sold, rather than directly measuring the efficiency of asset use.