C选项如何理解

问题如下：

Question Which of the following most likely indicates effective inventory management?

选项：

A.Sales growth rate exceeds finished goods inventory growth rate B.Current year’s days of inventory on hand exceeds the prior year’s days of inventory on hand C.Finished goods growth rate exceeds growth rate of inventories other than finished goods

解释：

Solution

A is correct. When the sales growth rate exceeds the finished goods inventory growth rate, the company is managing to service its increased sales level with a relatively lower level of inventory, indicating effective inventory management.

B is incorrect. Increasing days of inventory on hand may signal either effective inventory management, inadequate inventory to meet demand, or inventory write-downs due to decreasing demand.

C is incorrect. When the growth of finished goods inventory outstrips that of inventories other than finished goods, it suggests that finished goods are beginning to accumulate, consuming more of the entity’s resources. This suggests a possible decrease in demand that the company has not effectively responded to.