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Example Exercise 17-5 A company reports the following: SHOW ME HOW Cost of goods sold Average inventory $630,000 90,000 Deter
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Answer #1

a) Inventory turnover ratio

= cost of goods sold / average inventory

= $630000/90000

= 7

b) days' sales in inventory

= No.of days in a year/ inventory turnover ratio

= 365/7

= 52.1

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