The following information is available for Everett Company at December 31, 2015: beginning inventory $80,000; ending inventory $120,000; cost of goods sold $1,050,000; and sales $1,800,000. Everett's inventory turnover in 2015 is
A)8.7 times.
B)10.5 times.
C)13.2 times.
D)18 times.

Question

Quizplus · Accepted Answer

Inventory turnover = Cost of goods sold / Average inventory

Average inventory = (beginning inventory + ending inventory) / 2
Average inventory = ($80,000 + $120,000) / 2 = $100,000

Inventory turnover = $1,050,000 / $100,000 = 10.5 times.

The Following Information Is Available for Everett Company at December