GK
ACCOUNTING
|
Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
|
If the stock turnover ratio is 4 times and the collection period is 30 days the operating cycle would be
|
|
30 days
|
|
|
60 days
|
|
|
90 days
|
|
|
120 days
|
Explanation:
Detailed explanation-1: -Turnover Days in Financial Modeling You can calculate the inventory turnover ratio by dividing the inventory days ratio by 365 and flipping the ratio. In this example, inventory turnover ratio = 1 / (73/365) = 5. This means the company can sell and replace its stock of goods five times a year.
There is 1 question to complete.