Question

The Humongous Food Store (HFS) has a turnover ratio of 12. The turnover ratio is revenue divided by average inventory. This means, in a sense, that they sold everything in the store once per month. But HFS is losing money. The manager should:___________

Answer 1

Answer: compare his turnover ratio to other grocery stores' ratios.

Explanation: The manager should "compare his turnover ratio to other grocery stores' ratios" since Humongous Food Store (HFS) is losing money but have a turnover ratio of 12.

A turnover ratio of 12 means that they sold everything in the store once per month. Turnover ratio is the percentage of mural fund or portfolio holdings that have been replaced in a given year or 12 months period.