On Average, a Firm Sells R2,500,000 in Merchandise a Month

question 23

Multiple Choice

On average, a firm sells R2,500,000 in merchandise a month.Its cost of goods sold equals 80 percent of sales, and it keeps inventory equal to one-half of its monthly cost of goods on hand at all times.If the firm analyses its accounts using a 360-day year, what is the firm's inventory conversion period?

• A) 360 days
• B) 180 days
• C) 30 days
• D) 15 days
• E) 10 days

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Definitions:

Seventh Unit

Refers to the specific instance or item in a sequence or set, used here as a way to denote its particular position.

Utility Schedule

A table that shows the level of satisfaction or utility that a consumer derives from consuming different quantities of a good or service.

Marginal Utility

The extra pleasure or benefit a consumer receives from having one additional unit of a product or service.

Pepsi

A global brand of carbonated soft drinks produced and manufactured by PepsiCo.