Plij answer qvitium E7-15 (Algo) Analyzing and Interpreting the Inventory Turnover Ratio [LO 7-5]Clark & Scott Corporation is the biggest snowmobile manufacturer in the world. It reported the following amounts in its financialstatements (in millions):Net Sales RevenueCost of Goods SoldAverage InventoryRequired:2017$ 5,2002018$ 4,660-3,6205203,2204701-a. Calculate the inventory turnover ratio for 2018 and 2017.1-b. Calculate the average days to sell inventory for 2018 and 2017.2. Did inventory turnover at Clark & Scott improve or decline in 2018?3. Calculate the 2018 gross profit percentage.4. The main competitor for Clark & Scott is Arctic Cat. Prior to being acquired by Textron, Incorporated, Arctic Cat reported itsinventory turnover was 4.9 and its gross profit percentage was 5.5 percent. Why was Arctic Cat more likely than Clark & Scott torequire a write-down for LCM/NRV?Complete this question by entering your answers in the tabs below.

1a. Inventory Turnover Ratio Calculation:To calculate the inventory turnover ratio, we use the…

Answered: E7-15 (Algo) Analyzing and Interpreting…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Similar questions

Required information P7-6 (Algo) Analyzing and Interpreting the Effects of Inventory Errors LO7-5 [The following information applies to the questions displayed below.] The income statement for Pruitt Company summarized for a four-year period shows the following: Sales revenue Cost of goods sold Gross profit Expenses Pretax income Income tax expense (30%) Net income P7-6 Part 1 2016 2017 $2,041,000 $2,469,000 1,618,000 1,492,000 549,000 484,000 65,000 19,500 $45,500 Sales revenue Cost of goods sold Gross profit Expenses Pretax income Income tax expense (30%) Net income 851,000 496,000 355,000 106,500 $248,500 496,000 334,000 2018 $2,712,000 1,781,000 100,200 233,800 931,000 522,000 409,000 122,700 $286,300 An audit revealed that in determining these amounts, the ending inventory for 2017 was overstated by $21,000. The company uses a periodic inventory system. Answer is complete but not entirely correct. PRUITT COMPANY Income Statement For the Four-Year Period 2016 2017 $ 2,041,000…
E7-14 (Algo) Analyzing and Interpreting the Inventory Turnover Ratio LO7-5 Jetz is the leading manufacturer of personal computers. In a recent year, it reported the following in dollars in millions: Net sales revenue Cost of sales Beginning inventory Ending inventory $ 76,241 58,944 1,770 1,930 Required: Determine the inventory turnover ratio and average days to sell inventory for the current year. (Use 365 days a year. Round your intermediate calculations and final answers to 2 decimal places.) Inventory turnover Average days to sell inventory days
Perez Corporation has the following financial data for the years 20X1 and 20X2: Sales Cost of goods sold Inventory 20X1 20X2 20X1 $ 5,221,000 3,632,000 454,000 a. Compute the inventory turnover for each year using the formula Sales/Inventory. Note: Round your answers to 1 decimal place. Inventory Turnover Ratio times times 20X2 $ 6,578,000 4,862,000 572,000 b. Compute inventory turnover based on an alternative calculation that is used by many financial analysts, Cost of goods sold/Inventory, for each year. Note: Round your answers to 1 decimal place.
The following data were taken from the financial records of Sunland Company. Net Sales Beginning inventory Purchases Ending inventory (a1) 2022 $6,480,000 Inventory turnover 1,000,000 4,363,000 1,020,000 Your answer is incorrect. 2021 2022 $6,250,000 850,000 4,590,000 Compute for each year the inventory turnover. (Round answers to 1 decimal place, e.g. 1.6.) 1,000,000 times 2021 times
inventory turnover mine the effect of the erve on current ratio. P E6-11 Deere & Company is a global manufacturer and distributor of agricultural, con- struction, and forestry equipment. Suppose it reported the following information in its 2014 annual report. Exercises (in millions) 2014 2013 Inventories (LIFO) $ 2,397 30,857 12,753 1,367 16,255 $3,042 Current assets Current liabilities LIFO reserve Cost of goods sold Instructions (a) Compute Deere's inventory turnover and days in inventory for 2014. (b) Compute Deere's current ratio using the 2014 data as presented, and then again after adjusting for the LIFO reserve.
Snow Pack Corporation is the biggest snowmobile manufacturer in the world. It reported the following amounts in its financial statements (in millions): 2017 2018 Net Sales Revenue $ 4,900 $ 4,360 Cost of Goods Sold 4,290 3,810 Average Inventory 490 440 Required: 1-a. Calculate the inventory turnover ratio for 2018 and 2017. 1-b. Calculate the average days to sell inventory for 2018 and 2017. 2. Did inventory turnover at Snow Pack improve or decline in 2018? 3. Calculate the 2018 gross profit percentage. 4. The main competitor for Snow Pack is Arctic Cat. Prior to being acquired by Textron, Incorporated, Arctic Cat reported its inventory turnover was 4.6 and its gross profit percentage was 5.2 percent. Why was Arctic Cat more likely than Snow Pack to require a write-down for LCM/NRV?
Suppose 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. Beginning inventory Ending inventory LIFO reserve Current assets Current liabilities Cost of goods sold Sales revenue (a) Calculate the inventory turnover and days in inventory. (Round answers to 1 decimal place, e.g. 5.1) Inventory turnover $12,870 15,760 1,406 62.567 70,300 160,328 181,360 Days in inventory times days
The Kroger Company Net sales Cost of sales (using LIFO) Year-end inventories using FIFO Year-end inventories using LIFO Required: Compute the following: LIFO reserve is Kroger uses the LIFO inventory method and sales and cost of sales are reported above using LIFO. Gross margin in dollars (LIFO) Gross margin in dollars (FIFO) LIFO Inventory turnover* January 31, 2015 108,465.00 FIFO Inventory turnover* 85,512 6,933 5,688 February 1, 2014 February 2, 2013 98,375.00 96,619.00 78,138 76,726 6,801 6,244 5,651 5,146 January 31, 2015 February 1, 2014 February 2, 2013
inventory turnover E6-11 Deere & Company is a global manufacturer and distributor of agricultural, con- struction, and forestry equipment. Suppose it reported the following information in its 2014 annual report. mine the effect of the rve on current ratio. Exercises (in millions) 2014 2013 Inventories (LIFO) Current assets Current liabilities LIFO reserve $ 2,397 30,857 12,753 $3,042 1,367 16,255 Cost of goods sold Instructions c. Assume that the LIFO reserve last year (2013) was $1,219. What would Cost of Goods Sold be for 2014 under FIFO? d. Assume sales are $24,178. Compute the Gross Profit % using LIFO and FIFO. & PhotoGrid
Computing and Evaluating Inventory and PPE Turnovers Intel Corporation reports the following financial statement amounts in its 10-K reports. Cost of $ millions Sales Goods Sold Inventories 2016 $95,019 $24,501 $5,553 25,096 6,983 29,162 7,253 2017 100,418 2018 113,357 a. Compute the inventory and PPE turnover ratios for both 2017 and 2018. Note: Do not round until your final answer. Note: Round your final answers to one decimal place (for example, enter 6.8 for 6.77555). Inventory turnover PPE turnover 2017 Inventory turnover PPE turnover Plant, Property and Equipment, Net $36,171 41,109 48,976 2018 b. What changes are evident in the turnover rates of Intel for these years? < +
Answer questions 1 & 2 Exxon Mobil Corporation: Analyzing Effects of LIFO on Inventory Turnover Ratios The current assets of Exxon Mobil Corporation follow: ($ millions) 2014 2013 Current Assets Cash and Cash Equivalents $4,658 $4,913 Notes and Accounts Receivables $28,009 $33,152 Inventories: Crude oil, products and merchandise $12,384 $12,117 Materials and supplies $4,294 $4,018 Other current assets $3,565 $5,108 Total current assets $52,910 $59,308 In addition, the following note was provided in its 2014 10-K report: Inventories. Crude oil, products, and merchandise inventories are carried at the lower of current market value or cost…
The following data were taken from the financial records of Pharoah Company. Net sales Beginning inventory Purchases Ending inventory (a1) 2022 $6,310,000 905,000 Inventory turnover 5,137,500 1,080,000 Your answer is correct. 2021 $6,180,000 Compute for each year the inventory turnover. (Round answers to 1 decimal place, e.g. 1.6.) 2022 820,000 4,742,500 905,000 5.0 times 2021 5.4 times

SEE MORE QUESTIONS

Recommended textbooks for you

FINANCIAL ACCOUNTING

Accounting

ISBN:

9781259964947

Author:

Libby

Publisher:

MCG

Accounting

ISBN:

9781337272094

Author:

WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.

Publisher:

Cengage Learning,

Accounting Information Systems

Accounting

ISBN:

9781337619202

Author:

Hall, James A.

Publisher:

Cengage Learning,

FINANCIAL ACCOUNTING

Accounting

ISBN:

9781259964947

Author:

Libby

Publisher:

MCG

Accounting

ISBN:

9781337272094

Author:

WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.

Publisher:

Cengage Learning,

Accounting Information Systems

Accounting

ISBN:

9781337619202

Author:

Hall, James A.

Publisher:

Cengage Learning,

Horngren's Cost Accounting: A Managerial Emphasis…

Accounting

ISBN:

9780134475585

Author:

Srikant M. Datar, Madhav V. Rajan

Publisher:

PEARSON

Intermediate Accounting

Accounting

ISBN:

9781259722660

Author:

J. David Spiceland, Mark W. Nelson, Wayne M Thomas

Publisher:

McGraw-Hill Education

Financial and Managerial Accounting

Accounting

ISBN:

9781259726705

Author:

John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles

Publisher:

McGraw-Hill Education

SEE MORE TEXTBOOKS