Tinker's 2014 cost of goods sold was $750,000 and 2013 cost of goods sold was $770,000. The inventory at the end of 2014 was $188,000 and $208,000 at the end of 2013. Tinker's average number of days to sell its inventory during 2014 is closest to:

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Quizplus · Accepted Answer

The average inventory for 2014 is ($188,000 + $208,000) / 2 = $198,000. The inventory turnover ratio is $750,000 / $198,000 = 3.79. The average number of days to sell inventory is 365 / 3.79 ≈ 96 days.

Tinker's 2014 Cost of Goods Sold Was $750,000 and 2013