The last ratio Mr. Johnson is wanting is the inventory turnover ratio. What is this ratio actually telling us? It is demonstrating the how much we are paying on average for the merchandise we have each year or over a given period of time. Of course, higher numbers would be worse. It is demonstrating how many times we are selling our inventory of merchandise each year or over a given period of time. A higher number would be better. It is demonstrating how many times we are selling our inventory of merchandise each year or over a given period of time. A higher number would be worse.