Question

Cost of Goods Sold $18,800
Beginning Merchandise Inventory 520
Ending Merchandise Inventory 470

Select the labels and enter the amounts to compute the inventory turnover. ​(Enter the amount for average inventory to one decimal​ place, X.X. Round your answer to two decimal​ places, X.XX.)

Answer 1

Select the labels and enter the amounts to compute the​ days' sales in inventory for the year. ​(Round your answer to two decimal​ places, X.XX.)

Answer 2

To compute the inventory turnover, you first need to calculate the average inventory, and then use the formula for inventory turnover.

1. **Calculate Average Inventory**:
\[
\text{Average Inventory} = \frac{\text{Beginning Merchandise Inventory} + \text{Ending Merchandise Inventory}}{2}
\]
\[
\text{Average Inventory} = \frac{520 + 470}{2} = \frac{990}{2} = 495.0
\]

2. **Inventory Turnover Formula**:
\[
\text{Inventory Turnover} = \frac{\text{Cost of Goods Sold}}{\text{Average Inventory}}
\]
\[
\text{Inventory Turnover} = \frac{18,800}{495.0} \approx 37.88
\]

### Summary of the calculations:
- **Average Inventory**: $495.0
- **Inventory Turnover**: $37.88

You can enter the following amounts:

- Average Inventory: 495.0
- Cost of Goods Sold: 18,800
- Inventory Turnover: 37.88

Answer 3

To compute the days' sales in inventory, you first need to calculate the inventory turnover and then use that to find the days' sales in inventory with the following formula:

### Steps to Calculate Days' Sales in Inventory

1. **Calculate Inventory Turnover** (as we previously calculated):
\[
\text{Inventory Turnover} = \frac{\text{Cost of Goods Sold}}{\text{Average Inventory}}
\]
Given:
- Cost of Goods Sold (COGS) = $18,800
- Average Inventory = $495.0 (calculated previously)

\[
\text{Inventory Turnover} = \frac{18,800}{495.0} \approx 37.88
\]

2. **Calculate Days' Sales in Inventory**:
\[
\text{Days' Sales in Inventory} = \frac{365}{\text{Inventory Turnover}}
\]
\[
\text{Days' Sales in Inventory} = \frac{365}{37.88} \approx 9.63
\]

### Summary of the calculations:
- **Average Inventory**: 495.0
- **Inventory Turnover**: 37.88
- **Days' Sales in Inventory**: 9.63

You can enter the following amounts:

- Inventory Turnover: 37.88
- Days' Sales in Inventory: 9.63

Therefore, the final answer for Days' Sales in Inventory is **9.63**.