What Is the Inventory Turnover Ratio for ABC Corp

question 9

Multiple Choice

What is the inventory turnover ratio for ABC Corp.if cost of goods sold equals $5,000,current ratio equals 3,quick ratio equals 1.5,and the firm has $1,800 in current assets?

• A) 2.78 times
• B) 4.17 times
• C) 5.56 times
• D) 8.33 times

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Definitions:

Supply and Demand

Fundamental economic model describing how prices and quantities of goods and services are determined in a market based on the relationship between the quantity supplied and the quantity demanded.

Price Floor

A government or regulatory minimum price set for a commodity, below which it cannot legally be sold.

Farm Incomes

The earnings from agricultural activities that farmers receive, including profits from selling crops and livestock.

Binding Price Floor

A legally established minimum price that can be charged for a good or service, above the equilibrium price, leading to a surplus.