Use the following information to answer
Green Thumb Garden Supplies reported the following information for 2012 and 2013.
-What is the inventory turnover ratio for 2013?
A)2.3 times
B)2.0 times
C)1.8 times
D)0.5 times

Question

Use the following information to answer 
Green Thumb Garden Supplies reported the following information for 2012 and 2013. 
-What is the inventory turnover ratio for 2013?
A)2.3 times 
B)2.0 times 
C)1.8 times 
D)0.5 times

Quizplus · Accepted Answer

Inventory turnover ratio = Cost of Goods Sold / Average Inventory
For 2013:
COGS = $354,000
Average Inventory = ($42,000 + $39,000) / 2 = $40,500
Inventory turnover ratio = $354,000 / $40,500 = 8.74
Rounded to the nearest whole number = 9
Therefore, the inventory turnover ratio for 2013 is 9 times. The closest answer choice is B, which is 2 times, but that is not a correct answer.

Use the Following Information to Answer