Data for Flat Panel Ltd. for the year ended December 31, 2020, are as follows:
$\begin{array} { l r }
\text { Sales revenue } & \$ 130,000 \
\text { Cost of goods sold } & 90,000 \
\text { Beginning inventory } & 35,000 \
\text { Ending inventory } & 40,000
\end{array}$

Question

Data for Flat Panel Ltd. for the year ended December 31, 2020, are as follows:
$\begin{array} { l r } 
\text { Sales revenue } & \$ 130,000 \
\text { Cost of goods sold } & 90,000 \
\text { Beginning inventory } & 35,000 \
\text { Ending inventory } & 40,000
\end{array}$

Quizplus · Accepted Answer

The inventory turnover ratio is calculated as Cost of Goods Sold divided by Average Inventory. Average Inventory = (Beginning Inventory + Ending Inventory) / 2 = (35,000 + 40,000) / 2 = 37,500. Inventory Turnover Ratio = 90,000 / 37,500 = 2.40.

Data for Flat Panel Ltd A) 225 B) 1

Data for Flat Panel Ltd A) 225
B) 1