To measure inventory management performance, a company monitors its inventory turnover ratio. Listed below are selected data from the company’s accounting records.
| Current Year | Prior Year | |
|---|---|---|
| Annual Sales | $2,525,000 | $2,125,000 |
| Gross Profit | 40% | 35% |
Beginning finished goods inventory for the current year was 15% of the prior year’s annual sales, and ending finished goods inventory was 22% of the current year’s annual sales. What was the company’s inventory turnover at the end of the current period?
a. 1.82
b. 2.31
c. 2.73
d. 3.47
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