Question

Agnes Company reported the following data:    Quick assets $55,000 Current assets 150,000 Total liabilities 300,000...

Agnes Company reported the following data:
  

Quick assets $55,000
Current assets 150,000
Total liabilities 300,000
Average net receivables 12,600
Beginning inventory 38,000
Long-term liabilities 200,000
Net credit sales 126,000
Cost of goods sold 84,000
Ending inventory 46,000

What was the average number of days to sell inventory?

182.5

121.7

165.9

202.7

Homework Answers

Answer #1
Calculation of days sale in inventory:
Average inventory= (38000+46000)/2= 42000
Inventory turnover ratio= cost of goods sold/ average inventory
                                                 = 84000/42000=2
Days sale in inventory=365/ inventory turnover ratio
                                             =365/2=182.5
So correct answer is 182.5
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