Sales 600000 gross margin 200000 beginning inventory 1000000 ending inventory 600000

Inventory ratio indicates that how efficiently a company is turning its inventory into sales. The formula of calculating inventory ratio is : Cost of goods sold / average inventory

cost of goods sold = Sales - Gross margin =600000 -200000 =400000

Average stock = (opening stock + closing stock) /2 = (1000000 +600000)/2 =1600000/2 =800000

Inventory ratio =400000 /800000 =50%

Inventory turnover ration=cost of goods sold/average inventory at cost/2

Here is a illustration

=400000

1600000/2=800000

400000/800000=50%

Answer is B-50%

Inventory turnover will be B-50%

I agree with Mr. Rohit answer correct answer50%