The sales-to-inventory ratio: as a determination of financial performance, is go

Question

The sales-to-inventory ratio:

as a determination of financial performance, is good comparison tool.

is technically inferior to other commonly used ratios.

is superior to the inventory turnover ratio.

was developed by the Dupont Corporation and is satisfactory when used to make comparisons between the firm and the industry as a whole

as a determination of financial performance, is good comparison tool.

is technically inferior to other commonly used ratios.

is superior to the inventory turnover ratio.

was developed by the Dupont Corporation and is satisfactory when used to make comparisons between the firm and the industry as a whole

Explanation / Answer

The right option is d.

Sales-to-inventory ratio is the ratio between sales or cost of goods sold and average inventory. This ratio helps to compare the performance between firms or industries as a whole.

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