Which of the following is used to determine the rate of inventory turnover?
A)Cost of sales divided by Average inventory
B)Cost of sales times Gross profit
C)Cost of sales times Average inventory
D)Cost of sales divided by Gross profit

Question

Quizplus · Accepted Answer

The rate of inventory turnover is determined by dividing the cost of goods sold by the average inventory for the given period. This calculation shows how quickly a company is selling its inventory and replenishing it with new stock. Choice A represents this calculation accurately.

Which of the Following Is Used to Determine the Rate