Asked by
Bethany Marcum
on Oct 09, 2024
Verified
The formula for the average sale period is: Average sale period = Accounts receivable turnover ÷ Inventory turnover.
Inventory Turnover
A measure of how many times a company's inventory is sold and replaced over a period.
Average Sale Period
The average time taken to convert inventory into sales, also known as inventory turnover period.
- Attain insight into calculating and understanding financial ratios.
- Understand the significance of inventory management on financial ratios.
Verified Answer
MM
Learning Objectives
- Attain insight into calculating and understanding financial ratios.
- Understand the significance of inventory management on financial ratios.