A Company Has Average Inventory on Hand of $40,000 and Its

question 114

Multiple Choice

A company has average inventory on hand of $40,000 and its average days in inventory is 26.4 days.What is the cost of goods sold?

• A)$1,056,000
• B)$553,030
• C)$486,667
• D)$480,000

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Definitions:

Interest Rate

The amount charged by a lender to a borrower for the use of assets, expressed as a percentage of the principal.

Lease Payments

Regular payments made by a lessee to a lessor for the use of an asset.

Cost of Funds

The interest rate that financial institutions pay for the use of money or funds they lend out to borrowers.

Principal

Principal refers to the original sum of money borrowed in a loan or invested, exclusive of any interest or dividends.