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Inventory Turnover Ratio,

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3. Chaka Company had no prepaid expenses and inventories remained unchanged during the year. Other selected year-end data for the company includes the following:
Cost of goods sold $1,500,000
Current liabilities 1,800,000
Current ratio 3.0 to 1
Acid-test ratio 2.5 to 1
What was the company's inventory turnover ratio for the year? How may this information be used by managers, investors, or creditors?

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3. Chaka Company had no prepaid expenses and inventories remained unchanged during the year. Other selected year-end data for the company includes the following:
Cost of goods sold $1,500,000
Current liabilities 1,800,000
Current ratio 3.0 to 1
Acid-test ratio 2.5 to 1
What was the company's inventory turnover ratio for the year?
Current assets ÷ $1,800,000 ...

Solution Summary

Chaka Company had no prepaid expenses and inventories remained unchanged during the year. Other selected year-end data for the company includes the following:
Cost of goods sold $1,500,000
Current liabilities 1,800,000
Current ratio 3.0 to 1
Acid-test ratio 2.5 to 1
What was the company's inventory turnover ratio for the year? How may this information be used by managers, investors, or creditors?

$2.19