Days' Sales in Inventory

Multiple Choice

Days' sales in inventory:

A) Is a ratio that estimates how many days it will take to convert inventory on hand to accounts receivable or cash.
B) Is a ratio that tells us how much inventory a firm has on hand in terms of days' sales.
C) Is the number of days we can sell from inventory if no new items are purchased.
D) All of these answers are correct.
E) Is a ratio that estimates how many days it will take to convert inventory on hand to accounts receivable or cash and is a ratio that tells us how much inventory a firm has on hand in terms of days' sales.