Mid-Western Markets has sales of $1,389,400 and costs of goods sold of $892,700. Beginning inventory is $94,300 and ending inventory is $110,200. What is the inventory turnover rate?

Question

Quizplus · Accepted Answer

The inventory turnover rate is calculated as Cost of Goods Sold divided by the average inventory. Average inventory is (Beginning Inventory + Ending Inventory) / 2 = ($94,300 + $110,200) / 2 = $102,250. Inventory turnover rate = $892,700 / $102,250 = 8.73 times.

Mid-Western Markets Has Sales of $1,389,400 and Costs of Goods