A company calculated its inventory turnover for the past 2 years. This year the inventory turnover…

Calculate the inventory turnover ratio. (LO 6)

A company calculated its inventory turnover for the past 2 years. This year the inventory turnover is 6.3, and last year the inventory turnover was 7.5. Use this data to answer the following questions.

a. Will this change in the inventory turnover ratio be viewed as good news or bad news? Explain your answer.

b. Does the change indicate that more or less capital has been tied up in inventory this year compared to last year?

"Is this question part of your assignment? We can help"

ORDER NOW

0 replies

Leave a Reply

Want to join the discussion?
Feel free to contribute!

Leave a Reply

Your email address will not be published. Required fields are marked *