FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN: 9781259964947
Author: Libby
Publisher: MCG
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Financial statement data for years ending December 31 for Tango Company follow:
20Υ7
20Υ6
Cost of merchandise sold
$3,864,000
$4,001,500
Inventories:
Beginning of year
End of year
770,000
740,000
770,000
840,000
a. Determine the inventory turnover for 20Y7 and 20Y6.
b. Determine the days' sales in inventory for 20Y7 and 20Y6. Use 365 days and round
to one decimal place.
c. Does the change in inventory turnover and the days' sales in inventory from 20Y6 to
20Y7 indicate a favorable or an unfavorable trend?
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Transcribed Image Text:Financial statement data for years ending December 31 for Tango Company follow: 20Υ7 20Υ6 Cost of merchandise sold $3,864,000 $4,001,500 Inventories: Beginning of year End of year 770,000 740,000 770,000 840,000 a. Determine the inventory turnover for 20Y7 and 20Y6. b. Determine the days' sales in inventory for 20Y7 and 20Y6. Use 365 days and round to one decimal place. c. Does the change in inventory turnover and the days' sales in inventory from 20Y6 to 20Y7 indicate a favorable or an unfavorable trend?
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