From the following information the inventory turnover ratio will be nb...........

Finance (Phase -I & II) Others

From the following information, the inventory turnover ratio will be:

Net Revenue from Operations 2,00,000

Gross Profit 50,000

Inventory at the end 60,000

Excess of inventory at the end over inventory in the beginning 20,000

2 times

3 times

4 times

5 times

nventory Turnover Ratio= Cost of Goods Sold/Average Inventory

COGS= Net Sales – Gross Profit

= 2,00,000- 50,000= 1,50,000

Inventory in the beginning= inventory at end (–) 20,000

= 60,000 – 20,000 = 40,000

Average Inventory= Inventory in the beginning + inventory at end/2

=40,000 + 60,000/2 = 50,000

Inventory Turnover ratio= 1,50,000/50,000= 3 Times

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