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Major Manufacturing Company has direct materials used of $50,000, beginning raw materials inventory of $10,000 and ending raw materials inventory of $8,000.
Compute the raw materials inventory turnover.

Respuesta :

Answer:

5.55 times

Explanation:

The computation of the raw materials inventory turnover is shown below:

= Direct material used ÷ average raw material inventory

where,  

Average inventory = (Opening balance of raw material inventory + ending balance of raw material inventory) ÷ 2

= ($10,000 + $8,000) ÷ 2

= $9,000

And, the direct material used is $50,000

So, the raw materials inventory turnover would be

= $50,000 ÷ $9,000

= 5.55 times

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