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Nelly Inc.reported credit sales of $24,000,000 and cost of goods sold of $18,000,000 for the year.The average inventory for the year was $6,000,000.
-The days in inventory during the year was
A)15 days.
B)11 days.
C)91 days.
D)122 days.

Question

Use the following information for questions 
Nelly Inc.reported credit sales of $24,000,000 and cost of goods sold of $18,000,000 for the year.The average inventory for the year was $6,000,000.
-The days in inventory during the year was
A)15 days.
B)11 days.
C)91 days.
D)122 days.

Quizplus · Accepted Answer

Days in inventory is calculated as (Average Inventory / Cost of Goods Sold) * 365. For Nelly Inc., it is ($6,000,000 / $18,000,000) * 365 = 122 days.

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