Since inventory is a significant current asset for most retail organizations, the inventory turnover ratio would be of significance to investors and analysts in terms of assessing liquidity.

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The inventory turnover ratio is a measure of how efficiently a company is using its inventory to generate sales. A higher inventory turnover ratio indicates that a company is able to sell its inventory quickly, while a lower ratio indicates that inventory is not moving as quickly and could potentially lead to liquidity issues. Therefore, investors and analysts would consider the inventory turnover ratio when assessing a company's liquidity.

Since Inventory Is a Significant Current Asset for Most Retail