Inventory turnover ratio : Inventory turnover ratio is a financial measure that is used to evaluate as to how many times a company sells or uses its inventory during an accounting period. It can be calculated by using the following formula: [ Inventory turnover = Cost of goods sold Average inventory ] Days’ sales in inventory: Days’ sales in inventory are used to determine number of days a particular company takes to make sales of the inventory available with them. [ Days' sales in inventory = Days' in accounting period Inventory Turnover ] To Calculate: The inventory turnover of Company AK for 2015.

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Chapter 6, Problem 6.9BE

To determine

Inventory turnover ratio:

Inventory turnover ratio is a financial measure that is used to evaluate as to how many times a company sells or uses its inventory during an accounting period. It can be calculated by using the following formula:

[Inventory turnover =Cost of goods soldAverage inventory]

Days’ sales in inventory: Days’ sales in inventory are used to determine number of days a particular company takes to make sales of the inventory available with them.

[Days' sales in inventory =Days' in accounting period Inventory Turnover]

To Calculate: The inventory turnover of Company AK for 2015.

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