Which of the Following Is the Correct Formula to Calculate

question 102

Multiple Choice

Which of the following is the correct formula to calculate inventory turnover?

• A) Inventory turnover = Cost of goods sold / Average merchandise inventory
• B) Inventory turnover = Cost of goods sold × Average merchandise inventory
• C) Inventory turnover = Cost of goods sold + Average merchandise inventory
• D) Inventory turnover = Cost of goods sold - Average merchandise inventory

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Definitions:

Gross Profit Margin

A financial ratio that indicates the percentage of revenue that exceeds the cost of goods sold, reflecting the efficiency of a company in managing its production and labor costs.

Chosen A

A selection or preference identified as option A, indicating a different choice from a set of options.

Chosen B

A selection or preference identified as option B.

Praxiscope

An early animation device that creates the illusion of motion by spinning a series of still images viewed through slits; a precursor to modern animated filmmaking.