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if the inventory turnover ratio cast co is 5x and its gross profits and sales are $270 million and $1,200 million respectivelly then the inventory account for cast is
a.$180 million
b.$182 million
c.$186 million
d.$196 million

if the inventory turnover ratio cast co is 5x and its gross profits and sales are 270 million and 1200 million respectivelly then the inventory account for cast class=

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abiolataiwo2015

Answer:

c.$186 million

Explanation:

Calculation to determine what the inventory account for cast is

Using this formula

Inventory account for cast =Sales - Gross profit/Inventory turnover ratio cast

Where,

Sales=$1,200 million

Gross profit=$270 million

Inventory turnover ratio cast =5x

Let x be the inventory account for cast

Let plug in the formula

5x=$1,200 million-$270 million

5x=$930 million

x=$930 million/5

x=$186 million

Therefore the inventory account for cast is $186 million

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