Sarah's Smart Shop Has an Inventory Turnover Ratio of 3

Multiple Choice

Sarah's Smart Shop has an inventory turnover ratio of 3 times per year and an average inventory of $156,000. If Sarah could manage her inventory better and increase the number of turnovers to the industry average of 6 times per year, what average inventory would she need to generate the same level of sales?

A) $78,000
B) $52,000
C) $468,000
D) $312,000