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Working capital efficiency
Exploring the Impact of Inventory Turnover on Current Asset Management
December 23, 2023
What effect does inventory turnover have on current assets?
Inventory turnover directly influences the efficiency of current asset management. High turnover rates indicate efficient use of resources, converting inventory into sales quickly, improving cash flow, and reducing carrying costs. Low turnover rates signal potential issues like overstocking, tying up funds, and impacting liquidity and working capital efficiency negatively.
Tags : Inventory Turnover , Working Capital Efficiency , Asset Management