Inventory Turnover Accounting is a financial metric used to measure the speed at which items are sold and replaced in inventory. It is an important indicator of a company’s efficiency, as it indicates how well the business manages its resources. A higher ratio suggests that the company is selling products quickly and efficiently, while a lower ratio indicates slow sales or an inefficient use of resources. In order to calculate inventory turnover accounting, the cost of goods sold (COGS)is divided by the average inventory for a given period. This figure can then be compared to industry averages to assess the company’s performance. With accurate and timely data, companies can make adjustments to their strategies to ensure optimal inventory turnover and maximize profits.