Sugar, Inc. sells $938,600 of goods during the year that have a cost of $797,200. The balance in Inventory was $59,566 at the beginning of the year and $68,076 at the end of the year. How long on average does it take to sell something from inventory after it is purchased?

Question

Business

Isabel Schneider

28 December, 19:17

Sugar, Inc. sells $938,600 of goods during the year that have a cost of $797,200. The balance in Inventory was $59,566 at the beginning of the year and $68,076 at the end of the year. How long on average does it take to sell something from inventory after it is purchased?

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Answers (1)

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Keegan Riggs · Answer 1

inventory turnover days = 29.22 days

Explanation:

The inventory turnover period is the average length of time it takes to sell a stock item after it has been purchased.

It is calculated as = average inventory / cost of goods sold * 365 days

29.22060336

Average inventory = (Inventory at the beginning + inventory at the end) / 2

= (59,566 + 68,076) / 2

= 63,821

Inventory turnover days

= (63821/797,200) * 365 days

=29.22 days

THis implies that it takes sugar Inc about 29 days to sell its goods after they have been purchased