Answer: 12
Explanation: The ratio of number of times an inventory is used or sold in a specific period , generally a year, is called inventory turnover ratio. It can be computed by using the following formula :-
= [tex]\frac{cost\of\goods\sold}{average\inventory}[/tex]
where,
cost of goods sold = beginning inventory + net purchase - ending inventory
= $50,000 + $460,000 - $30,000
= $ 480,000
average inventory = [tex]\frac{beginning\invetory+closing\inventory}{2}[/tex]
=[tex]\frac{50000+30000}{2}[/tex]
= $40,000
so,
inventory turnover ratio = [tex]\frac{480000}{40000}[/tex]
= 12
