Inventory Turnovers. New management at Bosanac Supplies noted that materials inventory turned over every 18 days. Materials used during the year cost \(\$ 18,000,000\). The work in process inventory turnover was 24 . Production costs for the year were \(\$ 48,000,000\).

Steps were taken to obtain more frequent deliveries from suppliers so that operations could be conducted efficiently with only a 12-day supply of inventory. In addition, bottlenecks in production were eliminated, with the result being that the production costs will be 30 times the work in process inventory.

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1. What was the average materials inventory investment with a turnover every 18 days? Every 12 days?
2. What was the average work in process inventory investment with a turnover of 24 ? Of 30 ?
3. Explain why reducing inventory levels can improve the return on assets.