The inventory turnover ratio directly measures:
A)the days it takes to sell its average inventory balance.
B)the times per period the average inventory balance is sold.
C)how many days it takes to collect.
D)its sales of inventory sold on account.

Question

Quizplus · Accepted Answer

Analysts can assess how many times,on average,inventory has been bought and sold during the period by calculating the inventory turnover ratio.A higher ratio indicates that inventory moves more quickly from purchase to sale,reducing storage and obsolescence costs.

The Inventory Turnover Ratio Directly Measures