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15 February, 04:59

Major Manufacturing Company has direct materials used of $50,000, beginning raw materials inventory of $10,000 and ending raw materials inventory of $8,000.

Compute the raw materials inventory turnover.

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  1. 15 February, 05:11
    0
    5.55 times

    Explanation:

    The computation of the raw materials inventory turnover is shown below:

    = Direct material used : average raw material inventory

    where,

    Average inventory = (Opening balance of raw material inventory + ending balance of raw material inventory) : 2

    = ($10,000 + $8,000) : 2

    = $9,000

    And, the direct material used is $50,000

    So, the raw materials inventory turnover would be

    = $50,000 : $9,000

    = 5.55 times
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