Inventory turnover measures the relationship between:
A)merchandise inventory and current liabilities.
B)total assets and merchandise inventory.
C)cost of goods sold and merchandise inventory.
D)cost of goods sold and total liabilities.

Question

Quizplus · Accepted Answer

Inventory turnover measures how many times a company sells and replaces its inventory during a certain period. It is calculated by dividing the cost of goods sold by the average merchandise inventory. Therefore, the relationship it measures is between the cost of goods sold and merchandise inventory.

Inventory Turnover Measures the Relationship Between