The inventory turnover ratio is a measure of how many times during a period a company sells off its inventory.

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The inventory turnover ratio is calculated by dividing the cost of goods sold by the average inventory value during a specified period. This ratio indicates how efficiently a company is managing its inventory by selling it off and restocking it. The higher the ratio, the better, as it indicates that the company is selling its inventory quickly and not letting it sit idle for too long.

The Inventory Turnover Ratio Is a Measure of How Many