When There Is a High Inventory Turnover, There Is an Increase

question 39

Multiple Choice

When there is a high inventory turnover, there is an increase in sales because

• A) price points are set higher to accommodate for potential sales loss.
• B) new merchandise is continually available to customers.
• C) the merchandise begins to look shopworn.
• D) sales are increased by reducing prices.
• E) more money is available to buy new merchandise.

---

Definitions:

Credit Terms

Conditions under which credit will be extended to a borrower, detailing repayment amounts and the timeframe of repayment.

Discount

Generally a reduction in price or value. In finance, a reduction in the present value of a future sum due to the action of interest.

Net

Refers to the amount remaining after all deductions are made, such as taxes, expenses, and costs.

Short-Term Debt

Debts due for payment within the next fiscal year.