The Corner Hardware Has Succeeded in Increasing the Amount of Goods

question 85

Multiple Choice

The Corner Hardware has succeeded in increasing the amount of goods it sells while holding the amount of inventory on hand at a constant level. Assume that both the cost per unit and the selling price per unit also remained constant. This accomplishment will be reflected in the firm's financial ratios in which one of the following ways?

• A) Decrease in the inventory turnover rate
• B) Decrease in the net working capital turnover rate
• C) Increase in the fixed asset turnover rate
• D) Decrease in the day's sales in inventory
• E) Decrease in the total asset turnover rate

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Definitions:

Parasympathetic Division

A branch of the autonomic nervous system responsible for stimulating "rest-and-digest" or calming activities, reducing the body's stress response.

Autonomic Nervous System

The part of the nervous system that controls involuntary actions of the smooth muscles and heart and glands, regulating functions such as heart rate, digestion, respiratory rate, and pupillary response.

Sympathetic Division

Part of the autonomic nervous system that prepares the body for fight-or-flight responses, increasing heart rate and blood pressure, among other effects.

Overactive Thyroid

A condition, also known as hyperthyroidism, where the thyroid gland produces excessive amounts of thyroid hormones, leading to various health issues.