Bernstein Inc. Bernstein Inc. is a local retailer. The following selected information is available from their 2011 and 2012 financial statements:
Refer to the Bernstein Inc. information above. What was Bernstein's inventory turnover ratio for 2012? (round to two decimal places)

Question

Bernstein Inc. Bernstein Inc. is a local retailer. The following selected information is available from their 2011 and 2012 financial statements:
 Refer to the Bernstein Inc. information above. What was Bernstein's inventory turnover ratio for 2012? (round to two decimal places)

Quizplus · Accepted Answer

The inventory turnover ratio is calculated as cost of goods sold divided by average inventory. From the information given, we know that the cost of goods sold in 2012 was $710,000 and the average inventory for the year was $118,333 [(beginning inventory + ending inventory)/2]. Therefore, the inventory turnover ratio for 2012 is 6.00 ($710,000 / $118,333).