Thomas Company provided the following particulars for year 2017: $$\begin{array} { | l | l | }
\hline \text { Cost of sales } & \$ 1,100,000 \
\hline \text { Beginning inventory } & 340,000 \
\hline \text { Ending inventory } & 350,000 \
\hline
\end{array}$$ Calculate Thomas's rate of inventory turnover for the year.(Round your answer to two decimal places. )
A)3.14 times per year
B)3.19 times per year
C)1.59 times per year
D)3.24 times per year

Question

Thomas Company provided the following particulars for year 2017: $$\begin{array} { | l | l | } 
\hline \text { Cost of sales } & \$ 1,100,000 \
\hline \text { Beginning inventory } & 340,000 \
\hline \text { Ending inventory } & 350,000 \
\hline
\end{array}$$ Calculate Thomas's rate of inventory turnover for the year.(Round your answer to two decimal places. )
A)3.14 times per year
B)3.19 times per year
C)1.59 times per year
D)3.24 times per year

Quizplus · Accepted Answer

The inventory turnover rate is calculated as Cost of Sales divided by Average Inventory. Average Inventory = (Beginning Inventory + Ending Inventory) / 2 = (340,000 + 350,000) / 2 = 345,000. Inventory Turnover = 1,100,000 / 345,000 = 3.19 times per year.

Thomas Company Provided the Following Particulars for Year 2017 Calculate Thomas's Rate of Inventory Turnover for the Year