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Google’s inventory turnover ratio is much smaller than that for all comparison groups. Why do you...

Google’s inventory turnover ratio is much smaller than that for all comparison groups. Why do you think this is?

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Inventory Turnover Ratio is equal to the ratio of the cost of goods sold to the average inventory level. Inventory by definition includes a firm's raw materials, work in progress (partiall produced goods) and finishded goods. Hence, inventory is substantial and makes more sense only in case of manufacturing firms with tangible products to sell. Google on account of being a services firm (provides search services, advertisement platforms and the like) would have very negligible inventory, thereby possessing an inventory turnover ratio lower than most other firms.

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