Question

Days to sell measures the average number of ____________.

1) times per year inventory is purchased
2) days' sale in accounts payable
3) days' from the time inventory is purchased to the time it is sold
4) time per year receivables are collected

Answer 1

Days to sell is a financial ratio indicating the number of days from the purchase of inventory to its sale.

Step-by-step explanation:

Days to sell measures the average number of days from the time inventory is purchased to the time it is sold. This financial ratio is crucial for businesses to manage inventory levels effectively and ensures that capital is not unnecessarily tied up in stock.

It helps companies understand how quickly their product moves from stock to the customer and can be an indicator of sales performance and inventory management. Days to sell measures the average number of days' from the time inventory is purchased to the time it is sold.