Mike's Sportswear Company, a Retailer, Had Cost of Goods Sold

question 107

Multiple Choice

Mike's Sportswear Company, a retailer, had cost of goods sold of $420,000 last year.The beginning inventory balance was $31,000 and the ending inventory balance was $28,000.The company's average inventory turnover in days was closest to

• A) 25.63 days.
• B) 51.27 days.
• C) 26.94 days.
• D) 24.33 days.

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Definitions:

Short-run Cost Function

An economic formula that describes how production costs change in the short term with varying levels of output, assuming some inputs are fixed.

Average Cost

The cost per unit of output, calculated by dividing total costs by the total quantity of output produced.

Ovens

Cookery appliances designed for baking, roasting, and heating food through the application of direct or indirect heat.

Economies of Scope

Cost advantages that enterprises obtain through diversification and the production of a variety of goods rather than specializing in a single product.