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Q » What is inventory turnover ratio?
06 Dec, 2025
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A » The inventory turnover ratio measures how efficiently a company manages its inventory by calculating the number of times inventory is sold and replaced over a specific period. It is computed by dividing the cost of goods sold by the average inventory. A higher ratio indicates effective inventory management and strong sales, while a lower ratio may suggest overstocking or inefficiencies in sales strategies.
06 Dec, 2025
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