What information does inventory turnover provide?
Question:
Step by Step Answer:
The inventory turnov...View the full answer
Related Video
Inventory turnover is a key metric that helps businesses evaluate the efficiency of their operations. A high turnover ratio is generally considered positive, indicating that the company is effectively selling its inventory and making efficient use of its resources. On the other hand, a low turnover ratio may indicate issues such as overstocking or slow sales and may require further examination to identify and address the underlying causes. Businesses use this ratio to make decisions about inventory levels, production schedules, and pricing strategies. It also helps businesses to identify areas where they may need to make improvements, such as reducing lead times for production or optimizing sales and marketing efforts. Additionally, inventory turnover is used by investors and analysts as a key performance indicator to evaluate the financial health and growth potential of a company.
Students also viewed these Managerial Accounting questions
-
How does inventory turnover provide information about a companys short-term liquidity?
-
What information does the merchandise turnover provide about a companys short-term liquidity?
-
What does the inventory turnover ratio measure? What does average-days-in-inventory mean?
-
The Bay City Parks and Recreation Department is considering building several new facilities, including a gym, an athletic field, a tennis pavilion, and a pool. It will base its decision on which...
-
You are the CEO of a large company seeking to invest in either Central or South America and have directed your staff to prepare a report and recommendations. Two of the countries you are assigned are...
-
Solve Prob. 712 using the conjugate-beam method. Data from Prob. 712: Use the moment-area theorems and determine the slope at A and displacement at C. EI is constant. A 6 kN -1.5 m- -3 m- C -3 m-...
-
Describe in what ways the scope of nursing has changed.
-
On June 1, 2011, MacDougall Corporation approached Silverman Corporation about purchasing a parcel of undeveloped land. Silverman was asking $240,000 for the land and MacDougall saw that there was...
-
Q1 - At the heart of understanding marketing is something known as the marketing concept. In essence the marketing concept states: focus on creating transactions understand customer wants and needs...
-
Estimate the common logarithm of 10 using-linear interpolation. (a) Interpolate between log 8 = 0.903900 and log 12 = 1.0791812. (b) Interpolate between log 9 = 0.9542425 and log 11 = 1.0413927. For...
-
How is an NSF check accounted for in the accounting records?
-
What is an example of a business that would have a high inventory turnover? A low inventory turnover?
-
Use your graphing utility. Graph Newtons serpentine, y = 4x/(x 2 + 1). Then graph y = 2 sin (2 tan -1 x) in the same graphing window. What do you see? Explain.
-
Analyze the specific anti-money laundering (AML) and counter-terrorist financing (CTF) regulations that commercial banks must adhere to. Explain the measures and procedures in place for customer due...
-
Many retail companies are facing challenging financial situations as online shopping and low-priced competitors. Toys R Us seems to be a sign of what's to come for other retailers. Some are calling...
-
Your rich uncle has promised to give you $2,000 one year from today. After that, your uncle will increase the payout by 2% every year in perpetuity. Assuming a discount rate of 5% p.a., how much is...
-
You deposit $100,000 in a savings account today. The money will earn an annual rate of 6% interest, compounded monthly, for the next 10 years. How much do you have in the account at the end of 10...
-
ABC Limited has a net income of $40,000,000 and a profit margin of 10%. Total asset turnover is 25% and the current ratio is 3, while the amount of current liabilities is $72,000,000. Calculate the...
-
Assume that a building used by Carter County's police department is totally destroyed by a fire. It is then discovered that the building was not properly insured and that its current net book value...
-
Write a paper about the Working relationship in the organization- collaboration within and outside the organization
-
Determine the acid and base that were neutralized to produce each of the following salts. (a) Sodium fluoride, NaF(aq) (b) Magnesium iodide, MgI 2 (aq) (c) Calcium nitrate, Ca(NO 3 ) 2 ( aq) (d)...
-
Axon Corporation, which has three divisions, is preparing its sales budget. Each division expects a different growth rate because economic conditions vary in different regions of the country. The...
-
Carmen's Dress Delivery operates a mail-order business that sells clothes designed for frequent travelers. It had sales of $400,000 in December. Because Carmen's Dress Delivery is in the mail-order...
-
Carmen's Dress Delivery operates a mail-order business that sells clothes designed for frequent travelers. It had sales of $400,000 in December. Because Carmen's Dress Delivery is in the mail-order...
-
How can a financial risk can be managed? What is financial risk? what does it include and exclude? What do we study in the financial risk manager?
-
A manufactured product has the following Information for June. Direct materials Direct labor Overhead Units manufactured Standard Quantity and Cost 6 pounds @ $8 per pound 3 DLH @ $17 per DLH 3 DLH @...
-
BatCo makes baseball bats. Each bat requires 2.00 pounds of wood at $16 per pound and 0.25 direct labor hour at $20 per hour. Overhead is assigned at the rate of $40 per direct labor hour. Assume the...
Study smarter with the SolutionInn App