The average age of inventory ratio would most likely be considered:
A)a profitability ratio.
B)a leverage ratio.
C)a working capital measure.
D)a debt ratio.

Question

Quizplus · Accepted Answer

The average age of inventory ratio measures the average number of days it takes for a company to sell its inventory. This is a measure of how efficiently a company is managing its inventory levels and is therefore considered a working capital measure. This ratio is not directly related to profitability, leverage, or debt.

The Average Age of Inventory Ratio Would Most Likely Be