Which of the following statements is most consistent with efficient inventory management? The firm has a
A) below average inventory turnover ratio.
B) low incidence of production schedule disruptions.
C) below average total assets turnover ratio.
D) relatively high current ratio.

Question

Quizplus · Accepted Answer

A low incidence of production schedule disruptions indicates that the firm is able to manage its inventory well and keep production running smoothly. A below average inventory turnover ratio and below average total assets turnover ratio suggest that the firm may be carrying excess inventory, which is not efficient. A relatively high current ratio may indicate that the firm is holding onto excessive cash or other current assets, which could also be inefficient.

Which of the Following Statements Is Most Consistent with Efficient