Asked by Hanna Watkins on May 31, 2024
Verified
Zhang Company reported Cost of goods sold of $835,000,beginning Inventory of $37,200 and ending Inventory of $46,300.The average Inventory amount is:
A) $37,200.
B) $46,300.
C) $83,500.
D) $41,750.
E) $9,100.
Average Inventory
The mean value of a company's inventory over a specific period, used to analyze inventory levels and manage stock efficiently.
Ending Inventory
The cumulative worth of all products a company holds in inventory at the conclusion of a financial period.
Beginning Inventory
The value of all inventory held by a company at the start of an accounting period, before any purchases or sales have occurred.
- Derive the average stock quantities, analyze the accounts receivable turnover ratio, and figure out the total assets' turnover from the given data.
Verified Answer
= ($37,200 + $46,300)/2
= $83,500/2
= $41,750
Therefore, the average Inventory amount is $41,750.
Learning Objectives
- Derive the average stock quantities, analyze the accounts receivable turnover ratio, and figure out the total assets' turnover from the given data.
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