What is the average number of days to sell inventory for Company Y? (Do not round your intermediate calculations. Use 365 days in a year.)
A)12.5
B)40.9
C)29.3
D)32.7

Question

What is the average number of days to sell inventory for Company Y? (Do not round your intermediate calculations. Use 365 days in a year.)
A)12.5 
B)40.9 
C)29.3 
D)32.7

Quizplus · Accepted Answer

The days inventory outstanding (DIO) can be calculated as 365/inventory turnover ratio. From the financial statement, we can see that Company Y had an inventory turnover ratio of 12.46. Therefore, the DIO for Company Y is 365/12.46 = 29.30. The answer is (C)

What Is the Average Number of Days to Sell Inventory