Anthony Corporation reported the following amounts for the year: Anthony's average days in inventory is (round to the nearest whole day):
$$\begin{array} { | l | r | }
\hline \text { Net sales } & \$ 296,000 \
\hline \text { Cost of goods sold } & 138,000 \
\text { Average inventory } & 50,000 \
\hline
\end{array}$$

Question

Anthony Corporation reported the following amounts for the year: Anthony's average days in inventory is (round to the nearest whole day):
$$\begin{array} { | l | r | } 
\hline \text { Net sales } & \$ 296,000 \
\hline \text { Cost of goods sold } & 138,000 \
\text { Average inventory } & 50,000 \
\hline
\end{array}$$

Quizplus · Accepted Answer

The average days in inventory is calculated using the formula: $ \text{Average Days in Inventory} = \frac{365}{\text{Inventory Turnover}} $, where Inventory Turnover is $ \frac{\text{Cost of Goods Sold}}{\text{Average Inventory}} $. Here, Inventory Turnover is $ \frac{138,000}{50,000} = 2.76 $. Thus, Average Days in Inventory is $ \frac{365}{2.76} \approx 132 $ days.

Anthony Corporation Reported the Following Amounts for the Year: Anthony's