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28 September, 22:28

The McDonald's fast-food restaurant on campus sells an average of 7,200 quarter-pound hamburgers each week. Hamburger patties are resupplied twice a week, and on average the store has 795 pounds of hamburger in stock. Assume that the hamburger patties cost $4 a pound and there are 52 weeks in a year. a. What is the inventory turnover for the hamburger patties?

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  1. 28 September, 22:33
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    The inventory turnover for the hamburger patties is 470.95 times

    Explanation:

    The computation of the inventory turnover is shown below

    Inventory turnover ratio = (Cost of goods sold) : (average inventory)

    where,

    Cost of goods sold = Number of hamburgers each week * cost per hamburger * total number of weeks in a year

    = 1,800 * $4 * 52 weeks

    = $374,400

    Number of hamburgers each week = Average quarter hamburger pound : number of quarters in a year:

    = 7,200 : 4 quarters

    = 1,800

    And, the average stock is 795 pounds

    Now put the values to the above formula

    So, the value would be equal to

    = $374,400 : 795

    = 470.95 times
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