JAMB Accounts Principles of Accounts 2015 Paper

Concept:Stock turnover period shows how many days, on average, stock is held before it is sold.Explanation:Use the formula:$$\text{Stock turnover period} = \frac{\text{Average stock}}{\text{Cost of sales}} \times 365$$Substitute the given values:$$\frac{23,000}{300,000} \times 365$$First divide: $23,000 \div 300,000 = 0.07667$ approximately.Then multiply by 365 days:$$0.07667 \times 365 = 27.98 \text{ days}$$This is approximately 28 days.Answer:A. 28 days