Other Things Remaining the Same, If the Average Aggregate Inventory

question 3

Multiple Choice

Other things remaining the same, if the average aggregate inventory value goes down, then

• A)Inventory turnover ratio and weeks of supply will both go down.
• B)Inventory turnover ratio will go down, but the weeks of supply will stay the same.
• C)Inventory turnover ratio and weeks of supply will both go up.
• D)Inventory turnover ratio will go up, but weeks of supply will go down.
• E)Inventory turnover ratio stay the same, but weeks of supply will go down.

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Definitions:

Sales

The transactions involving the exchange of goods or services for money, contributing to a company's revenue.

Functional Currency

The currency of the primary economic environment in which an entity operates, usually the currency in which it generates and spends cash.

Income Statement

A financial statement that shows a company's revenues and expenses over a specific period, culminating in its net income or loss for that period.

Exchange Rates

The rate at which one currency can be exchanged for another, a key factor affecting international business and finance.