How Would You Interpret an Inventory Turnover Ratio of 10

question 10

Multiple Choice

How would you interpret an inventory turnover ratio of 10.7?

• A) It takes 50 days on average to collect receivables.
• B) Inventory is converted into sales every 50 days.
• C) The firm has sufficient inventories to maintain sales for 34.1 days.
• D) Assets are converted into sales every 50 days.

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Definitions:

United States

A country composed of 50 states and a federal district, spanning a large part of North America, known for its significant cultural and political influence globally.

Suicide

The act of intentionally causing one's own death.

English Language

A West Germanic language that originated from Anglo-Frisian dialects brought to Britain in the mid-5th to 7th centuries AD and is now the global lingua franca.

1550s

The decade between 1550 and 1559, often associated with significant historical events in various regions around the world.