Allison Robards Is the Owner of Backstreet Books, a Small

question 84

Multiple Choice

Allison Robards is the owner of Backstreet Books, a small eclectic-style bookstore in a bustling college town. Allison prides herself in selecting hard to find books and magazines that her clientele enjoy. Recently, Allison is experiencing a cash flow shortage, and she is concerned that she may be purchasing too many copies of each title. Having recently completed a business class, you suggest to Allison that she calculate the ______________ ratio for her store, and then compare it to other stores in her industry.

• A) current
• B) debt to equity
• C) return on equity
• D) inventory turnover

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Definitions:

Raw Materials

The basic material from which a product is made, typically used in the manufacturing or production process.

Indirect Cost

Expenses not directly linked to the production of goods or services, such as rent, utilities, and administrative salaries.

Cost Object

Anything for which cost data are desired. Examples of cost objects are products, customers, jobs, and parts of the organization such as departments or divisions.

traceability Of Costs

The ability to assign direct costs to specific cost objects and to allocate indirect costs accurately.