Misty Mountain Outfitters Is a Merchandiser of Specialized Fly Fishing

question 34

Multiple Choice

Misty Mountain Outfitters is a merchandiser of specialized fly fishing gear.Its cost of goods sold for Year 2 was $295,000,and sales were $690,000.The amount of merchandise on hand was $50,000,and total assets amounted to $585,000.What is the average number of days to sell inventory? (Round to the nearest day. )

• A)26 days
• B)62 days
• C)31 days
• D)40 days

---

Definitions:

Vertical Analysis

An accounting method where each entry in a financial statement is listed as a percentage of another item, typically used for comparing companies of different sizes or assessing trends within a single company over time.

Cost of Goods Sold

The direct expenses related to the manufacturing of products that a company sells.

Current Ratio

A liquidity measure that evaluates a company's ability to pay short-term obligations, calculated as current assets divided by current liabilities.

Liquidity Ratio

A financial metric used to determine a company's ability to pay off its short-term liabilities with its existing assets.