According to the text, which statement best describes inventory turnover?
A) the number of times each month that a company replaces its inventory
B) total costs divided by average sales
C) a higher inventory turnover does not necessarily lead to higher profits
D) turnover that is greater than two means the business is being run effectively

Question

Quizplus · Accepted Answer

A higher inventory turnover indicates that a company is selling and replacing its inventory frequently, but it does not automatically mean higher profits, as it depends on factors like pricing, cost management, and market demand.

According to the Text, Which Statement Best Describes Inventory Turnover