Suppose maestro's had cost of goods sold during the year of $ 230 comma 000 $230,000. beginning merchandise inventory was $ 35 comma 000 $35,000 , and ending merchandise inventory was $ 45 comma 000 $45,000. determine maestro's maestro's inventory turnover for the year. round to the nearest hundredth.

Question

Business

Imani

14 October, 05:36

Suppose maestro's had cost of goods sold during the year of $ 230 comma 000 $230,000. beginning merchandise inventory was $ 35 comma 000 $35,000 , and ending merchandise inventory was $ 45 comma 000 $45,000. determine maestro's maestro's inventory turnover for the year. round to the nearest hundredth.

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Marlene Kemp · Answer 1

5.75 times

Explanation:

The average Inventory Ratio shows the number of times a business sells and replaces its inventory. The formula used to calculate it.

Inventory Turnover Ratio = Cost of Goods Sold divide by Average Inventory)

where : Average inventory = Beginning inventory + ending inventory / 2

in this case average inventory = 35,000 + 45,000 / 2

=$80,000/2

=$40,000

cost of goods sold = $230,000

Inventory turnover ratio = 230,000

40,000

=5.75 times