Which of the following ratios would be of primary importance to a manager in evaluating the success of a new policy of reducing the stock of goods needed to meet customer demand?
A)Total asset turnover
B)Fixed assets turnover
C)Receivables turnover
D)Inventory turnover

Question

Quizplus · Accepted Answer

The inventory turnover ratio measures how efficiently a company is managing its inventory by calculating the number of times it sells and replaces its inventory over a period of time. A higher inventory turnover ratio indicates that the company is selling its products quickly and efficiently, which would be a good indicator of the success of a policy to reduce the stock of goods needed to meet customer demand.

Which of the Following Ratios Would Be of Primary Importance