Answered: Compute the inventory turnover ratio…

Compute the inventory turnover ratio and average selling period from the following data of a trading company: Sales: $75,000 Gross profit: $35,000 Opening inventory: $9,000 Closing inventory: $7,000

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Related questions

Q: A business had the following information in its acounts for the year:…

A: The objective of the question is to calculate the average number of days it takes for a business to…

Q: Inventory Analysis The following data were extracted from the income statement of Shriver Inc.:…

A: Inventory turnover is the number of times inventory is sold and replaced back in a time period.…

Q: The following company information is available: Average accounts receivable $800,000 Average…

A: The objective of the question is to calculate the company's inventory turnover ratio. The inventory…

Q: Examining the recent financial statements of McLelland Clothing, Inc., you note the following:…

A: Ratio Analysis Is a Method Of Analysis Of The Company's Liquidity, Profitability By Comparing The…

Q: Computing the rate of inventory turnover and days' sales in inventory Broadway Communications…

A: The inventory turnover ratio, also known as inventory turnover or stock turnover, is a financial…

Q: Based on the following data for the current year, what is the inventory turnover (rounded to one…

A: Avergae inventory=Merchandise inventory, beginning of the year+Merchandise inventory, end of…

Q: To measure inventory management performance, a company monitors its inventory turnover ratio. Listed…

A: The Inventory Turnover Ratio is a financial metric that measures how many times a company's…

Q: Analyzing Inventory Examining the recent financial statements of Etherington Fashion Corporation you…

A: FIFO inventory costing method is the one wherein the goods bought at first are to be sold first.…

Q: on a comparative balance sheet we have: inventory Prior year: 47 million Inventory current year:…

A: T-Account is also called the ledger.

Q: The cost of goods sold was computed at P12.250. Total sales for the year were P42950. of which…

A: Inventory Turnover Ratio = Cost of goods sold / Average Inventory Average Inventory = ( Beginning…

Q: Calculate the average inventory (in $) and inventory turnover ratio for the given company. (Round…

A: The inventory turnover ratio is the financial ratio formula which is used to determine the number of…

Q: A company reports the following: Cost of goods sold $4,788,800 Average inventory 292,000 Round…

A: Inventory turnover = Cost of goods sold / Average inventory where, Average inventory = (Beginning…

Q: Brill company reported the following year-end amount: Beginning Inventory $7,650 Net Cost of…

A: Step 1: Information givenBeginning Inventory = $7,650Net Cost of Purchases = $33,750Cost of Goods…

Q: A company reports the following: Cost of goods sold $335,070 Average inventory 74,460 Determine (a)…

A: Inventory turnover ratio means the number of times a company turns its inventory into sales. The…

Q: ABC Company had net sales of $500,000 and cost of goods sold of $300,000. The company's average…

A: Inventory turnover ratio is a financial metric used to assess the efficiency and effectiveness of a…

Q: Compute Altoona Company's (a) inventory turnover ratio and (b) number of days' sales in inventory…

A: Inventory Turnover Ratio:- Inventory turnover ratio is a financial metric used to measure how many…

Q: A company had net sales of $313,000. The beginning inventory at retail was $129,000 and the ending…

A: Turnover rate is the one which is determined by the entity to know the efficiency of something…

Q: Compute the inventory turnover ratio based on the following data: Sales revenue…

A: Inventory turnover ratio is the measure which is used to know the number of times company has sold…

Q: The following information is available for Heller Company: Beginning inventory $60,000 Cost of goods…

A: Inventory turnover8 timesDays in inventory45.6 daysExplanation:Inventory TurnoverInventory Turnover…

Q: below is information for the month of May Inventory, May 1 Purchases (gross) Freight-in Sales…

A: The cost of goods sold is calculated as difference between sales and gross profit. The net income is…

Q: P palace provided the following information: Ending inventory, previous period $95.500 Ending…

A: The inventory turnover is a measure of the number of times inventory is sold or used in a time…

Q: Cost of goods sold for Abe Distributors was $550,330 for the year. If the beginning inventory at…

A: Ratio analysis is one of the important technique of management accounting. Under this, various…

Q: Computing the rate of inventory turnover and days’ sales in inventory Broadway Communications…

A: Workings: Cost of Goods sold = $ 18400 Beginning Inventory = 560 Ending Inventory = 450 Average…

Q: company reports the following: Cost of goods sold $4,445,700 Average inventory 255,500 Determine…

A: Lets understand the basics. Inventory turnover ratio is a ratio which indicates how many time…

Q: Find the inventory turnover at retail of Walker Manufacturing. The starting inventory at retail was…

A: The inventory turnover at retail can be calculated using the formula: Inventory turnover at retail =…

Q: Based on the following data for the current year, what is the inventory turnover (rounded to one…

A: Efficiency ratios are also known as activity ratios. It measures how well companies utilize their…

Q: nventory Analysis The following data were extracted from the income statement of Keever Inc.:…

A: Inventory Turnover = Cost of Goods SoldAverage Inventory Number of days' sales in Inventory =…

Q: Lewis Incorporated and Clark Enterprises report the following amounts for the year. Lewis Clark…

A: The ratio analysis helps to analyze the financial statements of the business on the basis of the…

Q: Presented below is information related to Indigo Company. (a) Compute the ending inventory at…

A: Ending inventory is the amount of inventory that an entity has in hand at the end of the period. It…

Q: A company reports the following: Cost of goods sold $585,825 Average inventory 78,110…

A: Inventory turnover ratio: This is a financial measure that is used to evaluate as to how many times…

Q: Find the inventory turnover at retail of Walker Manufacturing. The starting inventory at retail was…

Q: Net sales $ 245,000 Cost of goods sold 176,000 Beginning inventory 54,000 Ending inventory…

A: Given information: Net sales is $245,000 Cost of goods sold is $176,000 Beginning inventory is…

Q: CG Films generates cost of goods sold of $135,000 for the year. Inventory at the beginning and end…

A: PLEASE LIKE THE ANSWER, YOUR RESPONSE MATTERS correct answer is = (a). 3.1 working note: inventory…

Q: What was Paloma Company's approximate inventory turnover ratio if the beginning inventory was…

A: gross profit = sales - the cost of goods sold given that, sales = $60000 gross profit = $22000…

Q: The inventory records for Radford Company reflected the following: Beginning inventory @ May 1 First…

A: Weighted average method is the one which is used to measure the cost of inventory on average cost…

Q: What is the inventory turnover if COGS is $10,000, beginning inventory was 200, and ending inventory…

A: Inventory Turnover:This is a financial metric used to quantify the number of times inventory is used…

Q: Using the accounts and amounts below, calculate Cost of Goods Sold: Account Amount Beginning…

A: Cost of goods sold = Beginning inventory + cost of goods purchased - ending inventory

Q: A business using the retail method of inventory costing determines that inventory at retail is…

A: It is a method to determine the cost of ending inventory balance via the cost to rate ratio It is…

Q: Find the inventory turnover at retail of Walker Manufacturing. The starting inventory at retail was…

A: Average inventory = (Beginning inventory + Ending inventory) / 2 = ($632,300 + $421,600) / 2 =…

Q: Presented below is information related to Marigold Company. Cost Beginning inventory $53,460…

A: The ending inventory comprises of the units that remains unsold at the end of the accounting period.…

Q: Marketing: Determine the stockturn rate of a retailer carrying an average inventory at cost of…

A: Calculate the stockturn rate of a retailer:

Q: Use the following information: Net sales Cost of goods sold $235,000 168,000 52,000 42,000 Beginning…

A: Ratio analysis is a tool used by the financial analyst to measure the financial performance of the…

Q: A company reports the following: Cost of goods sold $3,960,250 Average inventory 255,500 Round…

A: Inventory Turnover = Cost of goods sold/ Average Inventory Number of days sales in Inventory =…

Q: A business using the retail method of inventory costing determines that merchandise inventory at…

Q: Inventory Analysis The following data were extracted from the income statement of Keever Inc.:…

A: Ratio analysis is a method of measuring the organization's financial position with different kinds…

Q: Hayes Company had the following account balances at the end of the year: Beginning Inventory O…

A: The gross profit margin is the excess of revenue over the cost of goods sold. The income statement…

Question

Compute the inventory turnover ratio and average selling period from the following data of a trading company:

Sales: $75,000

Gross profit: $35,000

Opening inventory: $9,000

Closing inventory: $7,000

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

This is a popular solution!

SEE SOLUTION Check out a sample Q&A here

Step 1

VIEW

Step 2

VIEW

Trending now

This is a popular solution!

Step by step

Solved in 2 steps

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.

Similar questions

A company reports the following: Cost of goods sold $442,380 Average inventory 73,730 Determine (a) the inventory turnover and (b) the number of days' sales in inventory. Round interim calculations to the nearest dollar and final answers to one decimal place. Assume 365 days a year. a. Inventory turnover fill in the blank 1 b. Number of days' sales in inventory
The following data were taken from a company’s latest financial statements: Annual sales $2,433,332 Cost of goods sold 2,027,778 Inventories 500,000 Accounts receivable 600,000 Accounts payable 300,000 What is the company’s inventory conversion period? Which answers? 90 days 75 days 111 days 54 days
P palace provided the following information: Ending inventory, previous period $95,500 Ending inventory, current period $105,500 $450,550 $540,450 Sales, previous period Sales, current period Determine the inventory turnover for current period, assuming that gross profit for current year is $195,405. 2.99 times 3.43 times 3.61 times 3.27 times
Suppose that the following information is available for Nike Inc. for the current year. Beginning inventory Ending inventory Cost of goods sold Net sales Inventory turnover Days in inventory $10,000 Calculate the inventory turnover, days in inventory, and gross profit rate for Nike Inc. for the current year. (Round gross profit rate to 2 decimal places, e.g. 12.51 and other answers to 1 decimal place, e.g. 15.2. Use 365 days for calculation.) Gross profit rate 12,500 80,100 140,000 times days % .
Find the inventory turnover at retail of Walker Manufacturing. The starting inventory at retail was $634,300 and the ending inventory at retail was $423,600. Sales for the year totaled $2,388,870. Round your answer to the nearest tenth
Based on the following information compute (a) inventory turnover, (b) average daily cost of merchandise sold, and (c) days' sales in inventory for the current year. Use a 365-day year. Item Prior Year Current Year Cost of merchandise sold $172,900 $215,000 Inventory 18,000 12,000 If required, round your answers to two decimal places. (a) Inventory turnover times (b) Average daily cost of merchandise sold $ (c) Days' sales in inventory days (d) If an inventory turnover of 12 is average for the industry, how is this company doing?
Use the following information for Shafer Company to compute inventory turnover for year 2. Year 2 Year 1 Net sales $ 654,500 $ 584,300 Cost of goods sold 389,900 360,980 Ending inventory 79,100 80,780
The records of Sheridan Stores provided the following data for the year: Cost Retail (Base inventory) Inventory, January 1 $154,500 $278,000 Net purchases 830,000 1,304,000 Sales revenue 1,229,500 Other data are: Freight-in, $16,000; net markups, $8,000; net markdowns, $6,500; and the price index for the year is 108. Determine the approximate valuation of the final inventory by the dollar-value, LIFO-retail method. (Round ratio to 2 decimal places, eg. 75.35% and final answer to 0 decimal places, eg. 5,275.) Final inventory $
Compute the inventory turnover ratio based on the following data: Sales revenue $275,000 Cost of goods sold 168,000 Beginning inventory 35,000 Ending inventory 45,000
Following is an incomplete current-year income statement. Determine Net Sales, Cost of goods sold and Net Income. Additional information follows: Return on total assets is 16% (average total assets is $62,500). Inventory turnover is 5 (average inventory is $7,800). Accounts receivable turnover is 8 (average accounts receivable is $7,700). Income Statement Net Sales Cost of goods sold Selling, general, and administrative expenses 8800 Income tax expenses 3800 Net Income
Presented below is information related to Blue Company. cost Retail Begininng Inventory $59,780 $98,000 Purchases (net) $132,070 196,100 Net markups 11,067 Net markdowns 23,589 Sales Revenue 176,870 Compute the ending inventory at retail.
Calculate inventory turnover at cost (to nearest hundredth, format as 1.23 that's it, it's a ratio): Ending inventory $25,000 Cost of goods sold $43,000 Beginning inventory $15,000 Net sales $55,800