A company's cost of goods sold and sales were $281,250 and $1.2 million respectively. Assuming an inventory turnover of 3.5 what was the company's average inventory? (round to the nearest dollar)

Question

Quizplus · Accepted Answer

Inventory turnover = Cost of goods sold / Average inventory
3.5 = 281,250 / Average inventory
Average inventory = 281,250 / 3.5
Average inventory = $80,357 (rounded to the nearest dollar)

A Company's Cost of Goods Sold and Sales Were $281,250