Major Manufacturing Company has direct materials used of $50,000, beginning raw materials inventory of $10,000 and ending raw materials inventory of $8,000.

Compute the raw materials inventory turnover.

5.55 times

Explanation:

The computation of the raw materials inventory turnover is shown below:

= Direct material used : average raw material inventory

where,

Average inventory = (Opening balance of raw material inventory + ending balance of raw material inventory) : 2

= ($10,000 + $8,000) : 2

= $9,000

And, the direct material used is $50,000

So, the raw materials inventory turnover would be

= $50,000 : $9,000

= 5.55 times