Stock turnover ratio is?

Use the following information to answer below

	GH⊄
Sales	200000
Purchase	170000
Opening stock	40000
Closing stock	50000

 

A. 3.78 times
B. 3.56 times
C. 4 times
D. 3.2 times

Correct Answer:

Option B = 3.56 times

Explanation

Stock turnover = Cost of goods sold/Average stock

where Average stock = Opening stock + Closing stock /2

160,000 / 40,000 +50,000 /2

= 160,000 /45,000

= 3.555
≃ 3.56 times