Accounting Multiple Choice Question – 21 March 2018

The home of multiple choice questions for all your KS3, KS4 and KS5 Business Studies, Economics and Accounting requirements.

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 (times per year) ratio?

Select ONE answer:

  1. 11.43
  2. 21.40
  3. 2.93
  4. 31.94
  5. 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 1 – £4,400k / £385k = 11.43

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