The inventory turnover ratio and days sales outstanding (DSO) are two ratios used to assess how effectively a firm is managing its assets.

Question

Quizplus · Accepted Answer

The inventory turnover ratio measures how quickly a company is selling and replacing its inventory, while the days sales outstanding (DSO) ratio measures how quickly a company is collecting payment from its customers. Both are metrics used to evaluate a company's asset management efficiency.

The Inventory Turnover Ratio and Days Sales Outstanding (DSO) Are