Principles Of Marketing
17th Edition
ISBN: 9780134492513
Author: Kotler, Philip, Armstrong, Gary (gary M.)
Publisher: Pearson Higher Education,
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Question
Describe how might inventory turnover shed light on an organization competitiveness and efficiency?
Expert Solution
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Step 1
The inventory turnover proportion indicates the number of times a firm is capable to convert its inventory over. It can be calculated by taking the proportion of the cost of goods sold for a particular period and the mean inventory for the same period as follows.
Inventory turnover = Cost of good sold/
Average inventory
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