Practice - Inventory Turnover Ratio Formula
Enroll to start learning
You’ve not yet enrolled in this course. Please enroll for free to listen to audio lessons, classroom podcasts and take practice test.
Practice Questions
Test your understanding with targeted questions
What is the formula for the Inventory Turnover Ratio?
💡 Hint: Think about how inventory relates to sales.
What does a higher inventory turnover ratio indicate?
💡 Hint: It has to do with how quickly inventory is moving.
4 more questions available
Interactive Quizzes
Quick quizzes to reinforce your learning
What is the Inventory Turnover Ratio formula?
💡 Hint: Remember how inventory relates to sales speed.
True or False: A higher inventory turnover ratio is always preferred.
💡 Hint: Consider the balance required in inventory management.
2 more questions available
Challenge Problems
Push your limits with advanced challenges
A fashion retailer had a COGS of $400,000 and average inventory of $100,000. Calculate their inventory turnover ratio and interpret what it indicates about their inventory management.
💡 Hint: Use the ITR formula and reflect on what a 4 means in context.
Discuss a company scenario where the inventory turnover ratio is low, such as in seasonal industries. What strategies could they implement to improve the ratio?
💡 Hint: Think of how seasonal demand affects inventory and how to plan around it.
Get performance evaluation
Reference links
Supplementary resources to enhance your learning experience.