Wood Angel Ltd has provided a list of its assets and liabilities as at 31 December 2017 as follows:
- Long-Term Assets £400k
- Inventory £385k
- Accounts Receivables £340k
- Bank Account £210k
- Cash £50K
- Accounts Payable £365k
- Long-term Bank Loan £1800k
- Reserves £250k
- Share Capital £200k
- Revenue £5,800k
- Cost-of-Sales £4,400k
- Net Profit Margin £600k
- Purchases £2,800k
What is Wood Angel’s Rate of Inventory Turnover (days) ratio?
Select ONE answer:
- 11.43
- 21.40
- 2.93
- 31.94
- 1.82
Show your workings to arrive at your answer, and explain and justify your reasons:
……………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………
This is multiple choice question is suitable for Accounting KS5 classes.
The answer is 4 – £385k / £4,400k * 365 = 31.94 days
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