Question

Ira Company, a retailer, had cost of goods sold of $160,000 last year. The beginning inventory balance was $26,000 and the ending inventory balance was $24,000. The company's average sale period was closest to: Select one: a. 114.06 days b. 54.75 days c. 59.31 days d. 57.03 days

Answer 1

Answer:

The company's average sale period was closest to: b. 54.75 days

Explanation:

The average sale period measures the length of time that it takes to sell the inventory.

Average sale period = Inventory ÷ (Cost of Goods Sold / 365)

                                  = $24,000 ÷ ($160,000/365)

                                  = 54.75 days