Which of the following ratios is a measure of a company's ability to sell inventory?
A) The day's sales in receivables is a measure of a company's ability to sell inventory.
B) The current ratio is a measure of a company's ability to sell inventory.
C) The acid-test ratio is a measure of a company's ability to sell inventory.
D) The inventory turnover ratio is a measure of a company's ability to sell inventory.
D
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When a lot has been accepted by acceptance sampling, we know that:
A) it has more defects than existed before the sampling. B) it has had all its defects removed by 100% inspection. C) it will have the same defect percentage as the LTPD. D) it has no defects present. E) All of the above are false.
To reduce agency costs, issuing debt instead of equity provides incentives for managers to run a firm efficiently because ________
A) debt increases the funds available to managers to run the firm B) ownership of managers may remain more concentrated C) managers may take actions that benefit shareholders but harm creditors and lower the value of the firm D) shareholders prefer to decline new projects to save cash, even if their NPVs are positive