The inventory turnover ratio and days to sell measure will be affected by the cost flow assumptions used,which causes problems for financial statements users.
BT: Comprehension

Question

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Different cost flow assumptions, such as First-in-First-Out (FIFO) or Last-in-First-Out (LIFO), will result in different inventory valuations and will affect the inventory turnover ratio and days to sell measure. This can create problems for financial statement users trying to compare companies or make investment decisions.

The Inventory Turnover Ratio and Days to Sell Measure Will