Inventory Turnover Ratio Is

question 50

Multiple Choice

Inventory turnover ratio is:

• A) the ratio of a company's annual sales to its inventory.
• B) the ratio of a company's variable cost to its inventory.
• C) the ratio of a company's fixed cost to its inventory.
• D) the ratio of a company's annual cost to its inventory.
• E) the ratio of a company's fixed assets to its inventory.

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Definitions:

Business Entities

Organizations established as separate legal entities for the purpose of conducting business, such as corporations, partnerships, and sole proprietorships.

Sole Proprietorship

A business structure where the business is owned and operated by a single individual, who bears unlimited liability.

Corporation

A legal entity that is separate and distinct from its owners, providing limited liability to its shareholders.

Capital Account Balance

The amount of money in a company's or individual's capital account, indicating the net investment in the entity at a specific point in time.