Analysts maintain that two of the most important ratios are Inventory turnover and Accounts receivable turnover.
a. You are analyzing ABC Company, a computer manufacturer. You notice that inventory turnover this year is significantly lower than prior years. Provide three explanations that would be consistent with this observation. Explain whether these would be of concern to you and what the effect might be on next period's financial results.
b. You are analyzing ABC Company, a computer manufacturer. You notice that accounts receivable turnover this year is significantly lower than prior years. Provide three explanations that would be consistent with this observation. Explain whether these would be of concern to you.

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The Answer of Analysts maintain that two of the most important ratios are Inventory turnover and Accounts receivable turnover.
a. You are analyzing ABC Company, a computer manufacturer. You notice that inventory turnover this year is significantly lower than prior years. Provide three explanations that would be consistent with this observation. Explain whether these would be of concern to you and what the effect might be on next period's financial results.
b. You are analyzing ABC Company, a computer manufacturer. You notice that accounts receivable turnover this year is significantly lower than prior years. Provide three explanations that would be consistent with this observation. Explain whether these would be of concern to you.

Analysts Maintain That Two of the Most Important Ratios Are