Aa Aa E 8. Inventory analysis Inventory analysis assesses the effectiveness of a company's inventory management. Holding excess inventory decreases solvency by tying up cash in inventory, and it increases related costs such as storage costs, insurance expense, and property taxes. In addition, excess inventory exposes the company to the risk of price declines for its products or obsolescence of its inventory. Which inventory measure directly indicates how long the company's average inventory is held before it's sold to customers? O Number of days' sales in inventory O Inventory turnover Selected financial data for Freeman Inc. over the last two years are shown. Freeman Inc. Selected Financial Data For the Years Ended December 31, 2013 and 2012 2012 2013 $975,645 $920,822 Net sales $722,700 $657,730 Cost of goods sold Inventory: Beginning of year $131,546 $116,654 $189,654 $131,546 End of year