A Company Has $72,500 of Inventory at the Beginning of the Year

question 7

Multiple Choice

A company has $72,500 of inventory at the beginning of the year and $65,500 at the end of the year.Sales revenue is $986,400,cost of goods sold is $572,700,and net income is $124,200 for the year.The inventory turnover ratio is:

• A)1.8.
• B)8.3.
• C)6.0.
• D)14.3.

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Definitions:

Chart of Accounts

A list of all the accounts used in a company's accounting system, organized by category, that helps in preparing and reporting financial statements.

The Journal

A chronological record of all financial transactions, serving as the primary place to record entries in an accounting system.

Journal Entries

The method by which financial transactions are recorded in a company's accounting records; each entry typically includes a debit and a credit.

Adjusting Journal Entries

These are entries made in the accounting records to update the accounts for events that have occurred but have not yet been recorded.