Asset management ratios are important - firms need to manage assets efficiently because capital obtained to acquire those assets is expensive. These ratios include the: (1) Inventory turnover ratio, (2) Days sales outstanding, (3) Fixed assets turnover, and (4) Total assets turnover.
The inventory turnover ratio indicates how many times during the year inventory is Blank 1 Question 3 and restocked. Excess inventory is unproductive and represents an investment with a Blank 2 Question 3 rate of return.
The days sales outstanding (DSO) ratio is also called the average collection period (ACP). The DSO can also be evaluated by comparison with the terms on which the firm Blank 3 Question 3 its goods. If its trend has been rising and Blank 4 Question 3 policy has not changed, this would indicate a need to speed up the collection of receivables.