Inventory Turnover And DIH

This topic tests your understanding of how operating efficiency is measured from the financial statements, especially how quickly a company converts inventory into sales. Interviewers ask it because inventory metrics are a basic way to evaluate working capital management, business quality, and whether a company is efficiently managing stock levels relative to demand. The key reasoning is recognizing that one metric focuses on how often inventory is cycled through in a period, while the other translates the same idea into the average time inventory sits before being sold.