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    Question

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    A Inventory Turnover Ratio Correct Answer Incorrect Answer
    B Inventory Conversion Period Ratio Correct Answer Incorrect Answer
    C Inventory Management Ratio Correct Answer Incorrect Answer
    D Inventory Ordering Ratio Correct Answer Incorrect Answer

    Solution

    The ratio of Net Sales to Inventory is known as the Inventory Turnover Ratio. It is a financial metric that measures how efficiently a company is managing its inventory and how quickly it is selling its inventory during a specific period. The formula for Inventory Turnover Ratio is: Inventory Turnover Ratio = Net Sales / Average Inventory Where: Net Sales = Total Sales Revenue - Sales Returns and Allowances - Sales Discounts Average Inventory = (Opening Inventory + Closing Inventory) / 2

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