Last Year, Able Company Had Sales of $10 Million, Cost

question 2

Multiple Choice

Last year, Able Company had Sales of $10 million, Cost of Goods Sold of $6 million, Gross Profit of $4 million and Net Profit of $1 million.Average inventory at cost was $2 million.Able's inventory turn rate was:

• A)5 times
• B)3 times
• C)2 times
• D).5 times

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Definitions:

Dividend

A portion of a company's earnings distributed to its shareholders, usually in the form of cash or additional stock.

Record Date

The specific date set by a company on which the investors must own shares to be entitled to dividends.

Reverse Stock Split

A corporate action that consolidates the number of existing shares of stock into fewer, proportionally more valuable, shares.