Efficiency Ratio: Gateway Corp

question 54

Multiple Choice

Efficiency ratio: Gateway Corp. has an inventory turnover ratio of 5.6. What is the firm's days' sales in inventory?

• A) 65.2 days
• B) 64.3 days
• C) 61.7 days
• D) 57.9 days

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Definitions:

Inherited Property

Property that individuals receive as a result of the death of the previous owner, transferring ownership through a will or by law.

Depreciation Basis

The initial cost of an asset that is used to calculate depreciation expense over the asset's useful life.

Decedent's Basis

The value assigned to a deceased person's property for tax purposes, determining the basis for heirs or beneficiaries for capital gains tax calculations when they sell the property.

Ordinary Expense

Regular and necessary costs incurred in running a business that are tax-deductible.