Using the information below, compute the raw materials inventory turnover:

Raw materials used $ 85,500

Beginning raw materials inventory 8,000

Ending raw materials inventory 9,000

Multiple Choice:

A. 11.02.

B. 382.02.

C. 10.06.

D. 9.94.

E. 9.50.

C. 10.06.

Explanation:

* Assuming 8,000 and 9,000 is given in dollar terms rahter than a units.

Average raw material Inventory = (Beginning raw materials inventory + Ending raw materials inventory) / 2

Average raw material Inventory = (8,000 + 9,000) / 2

Average raw material Inventory = 8,500

Raw Material Inventory Turnover = Raw material Inventory used / Average raw material Inventory

Raw Material Inventory Turnover = $85,500 / 8,500

Raw Material Inventory Turnover = 10.06

C. 10.06

Explanation:

Raw materials inventory turnover is the ratio of the cost of raw material used to the average raw material for the period.

Given;

Raw materials used = $85,500

Beginning raw materials inventory 8,000

Ending raw materials inventory 9,000

Raw materials inventory turnover = $85,500 / ($8,000 + $9,000) / 2

= $85,500 * 2/$17000

= 10.05882353