Asked by Anthony Rodriguez on Jun 11, 2024

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A firm selling food should have higher inventory turnover rate than a firm selling office furniture.

Inventory Turnover Rate

A metric that measures how quickly a company sells its inventory within a given period, calculated by dividing cost of goods sold by average inventory.

Office Furniture

Items used in an office setting for the purpose of work, including desks, chairs, filing cabinets, and bookshelves.

  • Comprehend the repercussions of diverse management tactics on significant financial indicators.
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HF
Hiwot FantaJun 17, 2024
Final Answer :
True
Explanation :
A firm selling food has a shorter shelf life and higher demand compared to a firm selling office furniture. Therefore, the food firm needs to maintain a higher inventory turnover rate to avoid spoilage and ensure fresh products for customers. On the other hand, a firm selling office furniture can have a longer selling cycle and lower demand, resulting in a lower inventory turnover rate.