3. b. State the difference between the key inventory indicators; Inventory Turns Ratio and Days of Inventory Outstanding. The income statement of Alexa Corporation from 2019 showed the cost of goods sold (COS) was $39.40 million, and its average inventory value during the same period was $8.32 million.

Calculate the company’s number of Inventory Turns Ratios (ITR) for that year and Days of Inventory Outstanding (DIO). (10 Marks)

Answer rating: 100% (QA)

The inventory turns ratio and days of inventory outstanding are both measures of efficiency they measure how well the company is performing The differences between the two ratios are pointed below The ... View the full answer