INVENTORY TURNOVER, ACCOUNTS RECEIVABLE TURNOVER, AND MANUFACTURING PROFITABILITY: AN EMPIRICAL STUDY

Profitability is a criterion for determining the health of a business, so we need an analytical tool to evaluate it. The company will profit more if its inventory and accounts receivable turnover rates increase. Prior research identified discrepancies between inventories, receivables, and total asset turnover, as well as profitability measurements such as gross profit margin (GPM) and net profit margin (NPM), as well as ROA and ROE. This research aims to examine the link between inventory turnover (IT), accounts receivable turnover (ART), and profitability for manufacturing firms listed on the Bahrain Stock Exchange from 2012 to 2021. This research fills a gap in the literature. For empirical estimation, regression analysis has been used. The results reveal a statistically significant relationship between (IT), (ART), and profitability indices: gross profit margin (GPM). The study reveals that inventory turnover (IT) and accounts receivable turnover (ART) are crucial in predicting the profitability of a business.