Question

During the current calendar year, Bowman Corporation purchased $660,000 of inventory. The beginning inventory balance was $84,000, and the inventory balance at year-end was $120,000. The inventory turnover for the current year was:

Answer 1

Answer:

6.12 times

Explanation:

Cost of Goods Sold = $84,000 + $660,000 - $120,000

Cost of Goods Sold = $624,000

Average inventory = ($84,000 + $120,000) / 2

Average inventory = $102,000

Inventory Turnover = Cost of Goods Sold / Average inventory

Inventory Turnover = $624,000 / $102,000

Inventory Turnover = 6.117647059

Inventory Turnover = 6.12 times