Dave Murray's Pontiac Dealership Has an Inventory Turnover of 5

question 131

Multiple Choice

Dave Murray's Pontiac dealership has an inventory turnover of 5. What does this figure mean?

• A) The average value of Dave's inventory is five times his sales.
• B) For every $1 Dave spends on inventory, he reaps $5 in sales.
• C) Dave's beginning inventory is five times his ending inventory.
• D) Dave's average inventory is five times greater than his cost of goods sold.
• E) Dave sells and replaces his merchandise five times each year.

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Definitions:

Diversified

The process or state of becoming varied in character or form, often used in reference to investment portfolios or ecological variety.

Epoch

A division of geological time that is smaller than a period and is marked by distinctive features, events, or life forms.

Quaternary

The most recent period in the Earth's history, starting around 2.58 million years ago and continuing to the present day.

Cenozoic

The current geological era, beginning about 66 million years ago, characterized by the dominant emergence of mammals.