Kerry the Kangaroo Inc.specializes in producing and selling a stuffed kangaroo named Kerry.Although the stuffed kangaroo has sold well,the clothes that can be bought to dress the kangaroo have not sold as well as expected.As a result,Kerry the Kangaroo has warehouses full of hats,pants,sweaters,and shoes to dress Kerry.This firm used a _____ to determine how much of its capital is tied up in these accessory items.
A) payables turnover
B) receivables turnover
C) fixed asset turnover
D) inventory turnover

Question

Quizplus · Accepted Answer

Inventory turnover (COGS/Inventory) indicates how much of a firm's capital is tied up in its inventory, such as the accessory items for Kerry the Kangaroo.