The plant manager, Murat Kristal, at York Technologies makes Aircraft Navigation Systems. He expects you, as the new OM analyst, to provide some insight for performance of the plant. High on his list is an understanding of his inventory turnover based on the financial dataprovided below.Click the icon to view the additional information on the financial data.a) Based on total inventory, what is the inventory turnover for last year?Inventory turnover for last year isb) Based on total inventory, what is the inventory turnover for this year?Inventory tumover for this year istimes per year (round your response to two decimal places).c) Has inventory turnover improved this year?Inventory turnover hasthis year.times per year (round your response to two decimal places)More InfoSalesCost of goods soldGross marginOther expensesNet incomeFinished goods inventoryWork-in-process inventoryRaw material inventoryTotal inventory (average for year)Other current assetsOther assetsTotal assetsLAST YEAR$239,000140,00099,00054,00045,000Done3,00010,0006,00019,00097,000202,000318,000THIS YEAR$254,000150,000104,00054,00050,0004,50012,5007,50024,500106,000241,000371,500- X

Inventory turnover is a financial ratio that measures how efficiently a company manages its…

Answered: Click the icon to view the additional…

Century 21 Accounting General Journal

11th Edition

ISBN:9781337680059

Author:Gilbertson

Publisher:Gilbertson

Chapter20: Accounting For Inventory

Section: Chapter Questions

Problem 1ANFS

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Accountants at UltraTech obtain their values for inventory and total assets, calculate the balance sheet percentage by dividing inventory by total assets for each year and summarize the observations for the relative size of inventory to total assets for each year and percentage change from year-to-year. This would allow them to effectively assess: a. Inventory control compared to competitorsb. If there is an effective return on assetsc. If inventory is being properly managedd. How they are managing liabilities
The owner of a large machine shop has just i nished its i nancial analysis from the prior fiscal year. Following is an excerpt from the i nal report:a. Compute the inventory turnover ratio (ITR).b. Compute the weeks of supply (WS).
This information (in millions) is available for the Automotive and Other Operations Divisions of General Motors Corporation for a recent year. General Motors uses the LIFO inventory method. Instructions(a) Calculate the inventory turnover ratio and days in inventory.(b) Calculate the current ratio based on inventory as reported using LIFO.
The new owners of Sheraton Natural Foods Inc. have hired you to help them diagnose and cure problems that the company has had in maintaining adequate liquidity. As a first step, you perform a liquidity analysis. You then do an analysis of the company’s short-term activity ratios. Your calculations and appropriate industry norms are listed. Ratio Sheraton Industry Norm Current ratio 4.5 4.0 Quick ratio 2.0 3.1 Inventory turnover 6.0 10.4 Average collection period 73 days 52 days Average payment period 31 days 40 days Requirements: What recommendations relative to the amount and the handling of inventory could you make…
Hubble Space Incorporated has the following data which includes inventory conversion period or ICP of the firms against which it benchmarks. The firm's new manager is looking into the company on how he could reduce its inventory enough to reduce its ICP to the benchmarks’ average. If this were done, by how much would inventories decrease? Assume a 365-day year. Cost of goods sold =P85,000; Inventory =P20,000; Inventory conversion period (ICP) =85.88; Benchmark inventory conversion period (ICP) =38.00 *
You have been hired as a financial analyst of a firm and your team is working on an independent assessment of XYZ Inc. Your assistant has provided you with the following data for XYZ Inc. and their industry. R r e d : Ratio 2020 2019 2018 2020- Industry Average Inventory Turnover 62.65 42.42 32.25 53.25 Receivables in days 94 63 50 115 Debt to Equity 0.75 0.85 0.90 0.88 Quick Ratio 1.028 1.03 1.029 1.031 Current Ratio 1.33 1.21 1.15 1.25 Required: a) In annual report of firm CEO wrote, we had higher liquidity largely due to an increase in highly liquid current assets (cash, account receivable and short-term marketable securities). Is the CEO correct? b) what can you say about the firm's collection period and inventory turnover?
You are making a detailed analysis of the financial statements and accounting records of two companies: Adams Company and Bar Company. They are in the same industry, and price levels have been rising steadily for several years. In the course of your investigation, you observe that the inventory value shown on the Adams company balance sheet is quite close to the current replacement cost of the merchandise on hand. However, for Bar Company, the carrying value of the inventory is far below current replacement cost. Discuss what method of inventory valuation is probably used by each company. If we assume that the two companies are identical, except for the inventory valuation method used, Discuss which company has probably been reporting higher net income in recent years and how would you know.
Hubble Space Incorporated has the following data which includes inventory conversion period or ICP of the firms against which it benchmarks. The firm's new manager is looking into the company on how he could reduce its inventory enough to reduce its ICP to the benchmarks’ average. If this were done, by how much would inventories decrease? Assume a 365-day year. Cost of goods sold =P85,000; Inventory =P20,000; Inventory conversion period (ICP) =85.88; Benchmark inventory conversion period (ICP) =38.00 * A. P 8,129 B. P 7,316 C. P 9,032 D. P11,151 E. P10,036
An analyst wants to compare one firm's level of inventory last year to a competitor firm's level of inventory last year. Which one of the following financial statements provided for both firms would best help achieve this objective? Common size income statement Pro forma balance sheet Common size balance sheet Pro forma income statement
Calculate the inventory turnover, days sales outstanding (DSO), fixed assets turnover, and total assets turnover. Has the company’s ability to manage its assets improved or worsened? Explain. A computer manufacturer has financial statements as follows: Income Statements for Year Ending December 31 (Thousands of Dollars) 2019 2018 Sales $945,000 $900,000 Expenses excluding depreciation and amortization 812,700 774,000 EBITDA $132,300 $126,000 Depreciation and amortization 33,100 31,500 EBIT $99,200 $94,500 Interest Expense 10,470 8,600 EBT $88,730 $85,900 Taxes (25%) 22,183 21,475 Net income $66,547 $64,425 Common dividends $56,609 $54,115 Addition to retained earnings $9,938 $10,310 Balance Sheets for Year Ending December 31 (Thousands of Dollars) Assets 2019…
HACHING Company suspects that there is missing inventory in its warehouse at December 31, 2021. All sales and purchases were made on account. Also, the gross profit ratebased on net sales is consistent every year. To aid in your investigation, you obtained the following: How much is the net sales revenue for the year?
HAKDOG Company suspects that there is missing inventory in its warehouse at December 31, 2021. All sales and purchases were made on account. Also, the gross profit rate based on net sales is consistent every year. To aid in your investigation, you obtained the following: How much is the net purchases during the year?

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