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Asset Turnover Ratio - Definition
Total Asset Turnover Ratio: Total asset turnover ratio is used to measure operating performance. It is defined as the ratio between net sales and total assets. The ratio measures the revenue that is generated for every dollar of asset owned by the company. The formula for calculating the total asset turnover ratio is as follows:
Total Asset Turnover Ratio = Net Salesn / Average Total Assets
Where
Total Assets = Liabilities + Shareholders' Equity
Average Total Assets = Total Assetsn + Total Assetsn-1
n = Year
Fixed Asset Turnover Ratio: Fixed Asset Turnover Ratio measures the revenue that is generated by the company/management per dollar of fixed assets. The formula for fixed asset turnover ratio is as follows:
Fixed Asset Turnover Ratio = Revenuen / Average Fixed Assets
Where
Fixed Assets refer to Property, Plant and Equipment
Average Fixed Assets = Fixed Assetsn + Fixed Assetsn-1
n = Year
It would be perfectly natural in this sort of PPT presentation to use "n" and "n-1" in preference to words.