The following information was obtained from the accounting records of the Guerra Corporation for 2010: $\begin{array}{llc}\text{ Cost of goods sold }& \$3,600,000& \\ \text{ Merchandise inventory: }& & \\ & \text{ January }1& 400,000\\ & \text{ December }31& 460,000\end{array}$
Assuming a business year consisting of 365 days, what was Guerra's number of days' sales in inventories for 2010?

A) 46.6 days
B) 43.6 days
C) 40.6 days
D) 36.7 days

Merchandise Inventory

Products that a company holds in stock with the intent to sell as part of its business operations.

Cost of Goods Sold

Costs incurred directly from the production of goods a company markets, including both materials and workforce expenses.

Days' Sales

A financial ratio that measures the average number of days a company takes to convert its inventory into sales.