Question

Steve's Auto Shop began the year with an inventory of $12,050. Purchases during the year totaled $70,600. The inventory at the end of the year was $13,530.

a. What was the cost of goods sold?

$

b. What was the average inventory?

$

c. What was the turnover? Round your answer to two decimal places.

Answer 1

Answer

--Requirement a

A	Beginning Inventory	$12,050
B	Purchases	$70,600
C	Ending Inventory	$13,530
D = A+B - C	Cost of Goods Sold	$69,120

--Requriement b

A	Beginning Inventory	$12,050
B	Ending Inventory	$13,530
C = A+B	Total	$25,580
D = C/2	Average Inventory	$12,790

--Requirement c

A	Cost of Goods Sold	$69,120
B	Average Inventory	$12,790
C = A/B	Turnover	5.40