Question

Baker Mfg Inc. wishes to compare its inventory turnover to those of industry​ leaders, who have turnover of about 13 times per year and 8​% of their assets invested in inventory. Baker Mfg. Inc. Net Revenue ​$27 comma 500 Cost of sales ​$20 comma 720 Inventory ​$1 comma 270 Total assets ​$17 comma 550 ​a) What is​ Baker's inventory​ turnover? 16.32 times per year ​(round your response to two decimal​ places).

Answer 1

Answer:

16.31 times

Explanation:

The computation of the inventory turnover is shown below:

Inventory turnover ratio =  Cost of goods sold ÷ average inventory

where,

Cost of goods sold is $20,720

And, the average inventory is $1,270

So, the inventory turnover ratio is

= $20,720 ÷ $1,270

= 16.31 times

All other information that is given in the question is not relevant. Therefore, we ignored it