Question

A slowing turnover ratio combined with higher than normal inventory levels may indicate which of the following?

a. Efficient inventory management
b. Increased sales
c. Poor inventory turnover
d. Cost savings

Answer 1

A slowing turnover ratio combined with higher than normal inventory levels may indicate poor inventory turnover.

Step-by-step explanation:

A slowing turnover ratio combined with higher than normal inventory levels may indicate poor inventory turnover. Poor inventory turnover means that the company is not selling its inventory quickly enough, leading to excess inventory levels. When the turnover ratio is low and inventory levels are high, it suggests that the company is not efficiently managing its inventory and not generating enough sales.