Using the amounts below, calculate the inventory turnover ratio , average days in inventory, and gross profit
Question:
Net sales .......... $250,000
Cost of goods sold ......... 180,000
Beginning inventory ...... 55,000
Ending inventory ........ 45,000
Inventory Turnover Ratio
Inventory Turnover RatioThe inventory turnover ratio is a ratio of cost of goods sold to its average inventory. It is measured in times with respect to the cost of goods sold in a year normally. Inventory Turnover Ratio FormulaWhere,... Ending Inventory
The ending inventory is the amount of inventory that a business is required to present on its balance sheet. It can be calculated using the ending inventory formula Ending Inventory Formula =...
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Related Book For 
Financial Accounting
ISBN: 978-0078025549
3rd edition
Authors: J. David Spiceland, Wayne Thomas, Don Herrmann
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