The rate of turnover of a firm in a given year is 5 times while the average stock is #12,500. what is the turnover of the firm?
Answer Details
The rate of turnover of a firm in a given year being 5 times means that the firm is selling and replacing its stock 5 times in a year. If the average stock is #12,500, then the total value of stock the firm has at any given time is 5 times the average stock, which is 5 x #12,500 = #62,500. This means the turnover of the firm is #62,500.