The Inventory Turnover Ratio Is Calculated by Dividing

question 25

Multiple Choice

The inventory turnover ratio is calculated by dividing

• A)cost of goods sold by ending inventory.
• B)cost of goods sold by beginning inventory.
• C)cost of goods sold by average inventory.
• D)average inventory by cost of goods sold.

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Definitions:

Leadership Team

A group of individuals at the top of an organization who are responsible for making strategic decisions and guiding the company towards its goals.

Socially Responsible

Refers to practices and policies that a business adopts to benefit society and the environment, beyond what is legally required.

Customer Loyalty

The likelihood of previous customers to continue buying products or services from a specific business due to satisfaction with the product or service, convenience, or familiarity.

Profit Margins

The difference between the cost of goods sold and the sales revenue, expressed as a percentage of sales revenue, indicating the profitability of a product or business.