Calculate the inventory turnover ratio. (LO 6) A company calculated its inventory turnover for the past 2

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Calculate the inventory turnover ratio. (LO 6)

A company calculated its inventory turnover for the past 2 years. This year the inventory turnover is 6.3 , and last year the inventory turnover was 7.5. Use this data to answer the following questions.

a. Will this change in the inventory turnover ratio be viewed as good news or bad news? Explain your answer.

b. Does the change indicate that more or less capital has been tied up in inventory this year compared to last year?

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Financial Accounting

ISBN: 9780131492011

1st Edition

Authors: Jane L. Reimers

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Question Posted: Jun 05, 2024 01:06 AM

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Calculate the inventory turnover ratio. (LO 6) A company calculated its inventory turnover for the past 2

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Financial Accounting

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