If sales are $850,000, the cost of sales is $500,000 and average inventory is $55,000, the average time taken to sell inventory in days is:

Question

Quizplus · Accepted Answer

The average time taken to sell inventory, also known as the inventory turnover period, can be calculated using the formula: (Average Inventory / Cost of Sales) * 365. Plugging in the given numbers: ($55,000 / $500,000) * 365 = 0.11 * 365 = 40.15 days.

If Sales Are $850,000, the Cost of Sales Is $500,000