A declining inventory turnover ratio may mean that:
A)goods are not selling as fast as they were in the past.
B)the company is expecting to sell more in the future.
C)goods are selling,but it is taking longer to collect payment.
D)goods cannot be shipped fast enough.

Question

Quizplus · Accepted Answer

The inventory turnover is calculated by dividing cost of goods sold by average inventory.A decrease in the inventory turnover ratio may signal an unexpected drop in demand for the company's products or sloppy inventory management.

A Declining Inventory Turnover Ratio May Mean That