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Chapter 6: Q6TI (page 347)

The Opa鈥檚 Carving Shop had the following financial data for the year ended December 31, 2018:

Cost of Goods Sold $484,000

Beginning Merchandise Inventory 88,800

Ending Merchandise Inventory 111,200

What are the inventory turnover and days鈥� sales in inventory for the year?

Short Answer

Expert verified

Inventory Turnover: 4.84

Days鈥� Sales in Inventory: 75.41 days

Step by step solution

01

Inventory Turnover

InventoryTurnover=CostofgoodssoldAverageInventory=$484,000$88,800+$111,2002=$484,000$100,000=4.84

02

Days’ Sales in inventory

Days'SalesinInventory=No.ofdaysinayearInventoryTurnover=3654.84=75.41days

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Most popular questions from this chapter

Which principle states that businesses should use the same accounting methods and procedures from period to period?

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