Question

The following information is available for Oriole Company at December 31, 2018: beginning inventory $84000; ending inventory $116000; cost of goods sold $1250000; and sales $1770000. Oriole’s inventory turnover in 2018 is

17.7 times.

10.7 times.

12.5 times.

15.0 times.

Answer 1

Answer:
Average Inventory               = ( Beginning inventory + Ending inventory ) / 2               =   ( $ 84,000 + $ 116,000 ) / 2               =     $ 200,000 / 2               =      $ 100,000
Inventory Turnover                 = Cost of Goods Sold / Average Inventory                 =    $ 1,250,000 / $ 100,000	12.5 times
Option (C ) is Correct