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Corporate Finance

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Moderate

Inventory Turnover ratio vs. Industry Average

CORPFN-EJK4EX

An inventory turnover ratio of 7.2 compared to an industry average 6.1 is likely to indicate that

A

the firm is more efficient than the industry in managing its inventory levels.

B

the firm is over-investing in inventory compared to competitors.

C

the firm has lower COGS than its competitors, which is a bad sign for the firm.

D

the firm has higher sales than the industry average.