Which of the Following Is Used to Determine the Rate

question 78

Multiple Choice

Which of the following is used to determine the rate of inventory turnover?

• A)Cost of sales divided by Average inventory
• B)Cost of sales times Gross profit
• C)Cost of sales times Average inventory
• D)Cost of sales divided by Gross profit

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Definitions:

Price Ceiling

A legally established maximum price that can be charged for a good or service, aimed at preventing prices from rising too high.

Creates Shortage

A market condition where the quantity demanded exceeds the quantity supplied at a given price, often due to price controls like price ceilings.

Price Floor

A government-imposed minimum price level for a particular commodity or service, aimed at protecting producers.

Legal Minimum

A legally established lower threshold for payments or conditions, such as minimum wage.