Learning Objective $14-$A$1$: Assess raw materials inventory management using raw materials inventory turnover and days$$ sales in raw materials inventory.

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A high raw materials inventory turnover suggests a business is more effective in managing its raw materials inventory. We use days$$ sales in raw materials inventory to assess the likelihood of production being delayed due to inadequate levels of raw materials. We prefer a high raw materials inventory turnover ratio and a small number of days$$ sales in raw materials inventory, provided that raw materials inventory levels are adequate to keep production steady.