Company A’s inventory turnover is 5 and Company B’s is 3. Which of the following conclusions can be drawn?
a. Company A has a higher risk of stock-outs than Company B.
b. Company A has a lower risk of lost sales than Company B.
c. Company A converts its inventory to profits slower than Company B.
d. Company A has a higher risk of product theft than Company B.
Answer: a. Company A has a higher risk of stock-outs than Company B.
Business
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