Misty Mountain Outfitters is a merchandiser of specialized fly fishing gear.Its cost of goods sold for Year 2 was $295,000,and sales were $690,000.The amount of merchandise on hand was $50,000,and total assets amounted to $585,000.What is the average number of days to sell inventory? (Round to the nearest day. )

Question

Quizplus · Accepted Answer

Inventory turnover = Cost of goods sold ÷ Inventory
Inventory turnover = $295,000 ÷ $50,000 = 5.9 times
Average number of days to sell inventory = 365 ÷ Inventory turnover
Average number of days to sell inventory = 365 ÷ 5.9 times = 62 days

Misty Mountain Outfitters Is a Merchandiser of Specialized Fly Fishing