Answer:
2.0 times
Explanation:
The inventory turnover ratio indicates how efficient a company is in converting its inventory into sales. It shows the number of times a business sells and restocks its inventory in a period.
The formula for calculating inventory turnover is as follows.
Inventory turn over = Costs of goods sold/ Average inventory
For Castile Co.
COGS is $18,000
Average inventory = Beginning inventory + ending inventory /2Beginning inventory = $6,000
if COGS = Beginning inventory + Purchases - Ending inventory
Then $18,000 = $6000 +$24,000 - ending inventory
=$18,000 = $30,000 -ending inventory
Ending inventory = $30,000-$12,000
Ending Inventory =$12,000
Average inventory = $6000+$12,000/2
Average inventory = $9,000
Inventory turnover = $18000/$9000
=2.0
