Padco averages $15 million worth of inventory in all of its worldwide locations. They operate 51 weeks a year and each week average $3 million in sales (at cost). Their inventory turnover is:

Question

Quizplus · Accepted Answer

Inventory turnover = Cost of goods sold / Average inventory
Cost of goods sold = (weekly sales x 51 weeks) = $3 million x 51 = $153 million
Average inventory = $15 million
Therefore, inventory turnover = $153 million / $15 million = 10.2 turns.

Padco Averages $15 Million Worth of Inventory in All of Its