Calculate C Co's inventory turnover ratio and the days' sales in inventory for 2012.
A) 6.11 times and 59.7 days
B) 5.89 times and 62.0 days
C) 18.41 times and 19.8 days
D) 5.58 times and 65.4 days

Question

Quizplus · Accepted Answer

Inventory turnover ratio = Cost of goods sold / Average inventory= 1,220,000 / (200,000 + 150,000) / 2= 6.11 timesDays' sales in inventory = 365 days / Inventory turnover ratio= 365 days / 6.11 times= 59.7 days

Calculate C Co's Inventory Turnover Ratio and the Days' Sales