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Dmitry_Shevchenko [17]
3 years ago
11

Suppose at December 31 of a recent year, the following information (in thousands) was available for sunglasses manufacturer Oakl

ey Inc.: ending inventory $170,000; beginning inventory $125,000; cost of goods sold $351,050 and sales revenue $761,000.
a. Calculate the inventory turnover for Oakley, Inc.
b. Calculate the days in inventory for Oakley, Inc.
Business
1 answer:
Leviafan [203]3 years ago
4 0

Answer and Explanation:

The computation is shown below:

a. The inventory turnover is

= Cost of Goods Sold ÷  Average Inventory

= $351,050 ÷ ($170,000 + $125,000) ÷ 2

= $351,050 ÷ $147,500

= 2.38 times

b. Now days in inventory is

= 365 ÷ inventory turnover ratio

= 365 ÷ 2.38 times

= 153.36 days

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