Question

Employee Benefit expenses is 10,000;
Cost of revenue from operation = 60,000;
Opening Inventory is 30,000 and
Average Inventory is 20,000.
Calculate Inventory Turnover Ratio

• A. Cost of goods sold in a given period and the average amount of inventory held during that period
• B. Cost of goods sold in a given period and the average amount of stock held during that period
• C. Both : Cost of goods sold in a given period and the average amount of inventory held during that period Cost of goods sold in a given period and the average amount of stock held during that period
• D. None of these

Answer 1

The correct option is C

Both :

Cost of goods sold in a given period and the average amount of inventory held during that period

Cost of goods sold in a given period and the average amount of stock held during that period

Inventory Turnover Ratio = 60,000 / 20,000 = 3 times