Carrington, Inc. began the year with $130,000 in merchandise inventory and ended the year with $190,000. Sales and cost of goods sold for the year were $900,000 and $640,000, respectively. Use a 360 day year in your calculations.
Required:
1. Compute Carrington's inventory turnover ratio.
2. Compute the number of days' sales in inventory.

Question

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The Answer of Carrington, Inc. began the year with $130,000 in merchandise inventory and ended the year with $190,000. Sales and cost of goods sold for the year were $900,000 and $640,000, respectively. Use a 360 day year in your calculations.
Required:
1. Compute Carrington's inventory turnover ratio.
2. Compute the number of days' sales in inventory.