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View Full Version : Inventory turnover and current ratios


pitttorr
Dec 12, 2010, 06:11 PM
Inventory turnover and current ratios they related?

Just Looking
Dec 12, 2010, 08:37 PM
They use entirely different data and look at different aspects of the business.

Inventory turnover tells you the number of times inventory is sold or used in a time, often a year. A low turnover could mean the company has obsolence issues, or problems with their product line or marketing efforts.

Current ratio measures the company's ability to pay short-term debt.