What is Inventory/Stock Turnover Ratio? What does it indicate?

What is Inventory/Stock Turnover Ratio? What does it indicate?


It indicates that inventories are turned over in the form of sales more number of times. A high inventory turnover ratio indicates that maximum sales turnover is achieved with the minimum investment in the inventory. High turnover ratio is desirable.

Formula to calculate inventory turnover ratio = Cost of goods sold/ Average inventory
What is Debtors Turnover Ratio? What propositions should be kept in mind while working with them?
Debtors Turnover Ratio indicates the number of times average debtors are turned over during a year
What is Capital Turnover Ratio? What does it indicate?
Capital Turnover Ratio indicates the efficiency of the organization with which the capital employed is being utilized…
Explain Debt Equity Ratio. What are its components? What does it indicate?
Debt Equity Ratio is one of the ratios of solvency group. It indicates the stake of shareholders and creditors in the organization…
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