A firm's inventory turnover (IT) is 5 times on a cost of goods sold (COGS) of $800,000. If the IT is improved to 8 times while the COGS remains the same, a substantial amount of funds is released from or additionally invested in inventory. In fact, a) $160,000 is released. b) $100,000 is additionally invested. c) $60,000 is additionally invested. d) $60,000 is released

A firm's inventory turnover (IT) is 5 times on a cost of goods sold (C

1.	A firm's inventory turnover (IT) is 5 times on a cost of goods sold (COGS) of $800,000. If the IT is improved to 8 times while the COGS remains the same, a substantial amount of funds is released from or additionally invested in inventory. In fact, a) $160,000 is released. b) $100,000 is additionally invested. c) $60,000 is additionally invested. d) $60,000 is released
Answer» d) $60,000 is released

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