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Question & Answer: Excerpts from Hulkster Company's December 31, 2018 and 2017, financial statements are presented below: Accounts receivable Merchandise invent…..

Excerpts from Hulkster Companys December 31, 2018 and 2017, financial statements are presented below: Accounts receivable Merchandise inventory Net sales Cost of goods sold Total assets Total shareholders equity Net income 2018 $ 42,000 29,000 213,300 116,000 427,000 242,000 34,000 2017 37,000 37,000 200,000 109,000 406, 000 226,000 29,000 Hulksters 2018 inventory turnover is: (Round your answer to 2 decimal places.)

Excerpts from Hulkster Company’s December 31, 2018 and 2017, financial statements are presented below: Accounts receivable Merchandise inventory Net sales Cost of goods sold Total assets Total shareholders’ equity Net income 2018 $ 42,000 29,000 213,300 116,000 427,000 242,000 34,000 2017 37,000 37,000 200,000 109,000 406, 000 226,000 29,000 Hulkster’s 2018 inventory turnover is: (Round your answer to 2 decimal places.)

Expert Answer

 

The correct answer is 3.52

Note :

Inventory Turnover = Cost of Goods Sold / (Average Inventory)

= Cost of Goods Sold / [( 2018 Inventory + 2017 Inventory )/2]

= $ 116,000 / [ (29,000+ 37,000) /2]

= 3.52

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