A manufacturing company producingmedical devices reported $50 million in sales over the last year.At the end of the same year, the company had $17 million worth ofinventory of ready-to-ship devices.(Round your answer to 1 decimalplace.)Assuming that units ininventory are valued (based on cost of goods sold) at $750 per unitand are sold for $2000 per unit, what is the company’s annualinventory turnover?
Expert Answer
Inventory turnover Ratio (ITR) = COGS / AverageInventory = Sales / Average inventory
Given that, Sales = $50 million
Inventory = $17 million
ITR = 50 million / 17 Million
= 2.9