What is the inventory turnover for a company with the following financial data?
What is the inventory turnover for a company with the following financial data?
The inventory turnover ratio is calculated by dividing the cost of goods sold by the inventory. Given the financial data: Cost of goods sold is $14,181,000 and Inventory is $7,411,000. The calculation is as follows: Inventory turnover ratio = Cost of goods sold / Inventory = $14,181,000 / $7,411,000 = 1.91. Therefore, the correct inventory turnover ratio is 1.91.
The inventory turnover ratio is calculated by dividing the cost of goods by average inventory for the same period.
Cost of goods sold = $14,181,000 Inventory = $7,411,000 Using the cost of goods sold and inventory value, the inventory turnover ratio is: Inventory turnover ratio = Cost of goods sold / Inventory = $14,181,000 / $7,411,000 = 1.91