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Which of the following statements is most consistent with efficient inventory management? The firm has a....

Which of the following statements is most consistent with efficient inventory management? The firm has a. relatively low DSO. b. below average total assets turnover ratio. c. below average inventory turnover ratio. d. relatively high current ratio. e. low incidence of production schedule disruptions.

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Answer #1

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The correct Option is e. low incidence of production schedule disruptions.

It helps with efficient inventory management

The other options a,b,c and d are incorrect.

Option a relatively low DSO heps in cash conversion cycle not in efficient inventory management

Option b below average total assets turnover ratio wull decrease the ROE ( sales / assets) . reduction in sales does not help in  efficient inventory management.

Option c. avove average invenory turnover ratio aids in efficient inventory management not below average invenory turnover ratio

Option d high current ratio increases the liquidity needs of company and it doesnot helps in with efficient inventory management.

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