If the level of inventory rises, all else constant, then:
A) The days' sales in inventory will also rise.
B) The NWC ratio will also rise.
C) Inventory turnover will also rise.
D) Fixed asset turnover will decline.
E) Current ratio will decline.

Question

Quizplus · Accepted Answer

When inventory levels rise, the days' sales in inventory, which measures how long it takes to sell inventory, will also increase, assuming sales remain constant.

If the Level of Inventory Rises, All Else Constant, Then