FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN: 9781259964947
Author: Libby
Publisher: MCG
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Inventory turnover and number of days' sales in inventory
Financial statement data for years ending December 31 for Tango Company follow:
20Υ7
20Y6
Cost of goods sold
$3,861,700 $4,080,700
Inventories:
Beginning of year
803,000
766,500
End of year
876,000
803,000
Required
a. Determine the inventory turnover for 20Y7 and 20Y6. Round to one decimal place.
20Υ7
20Y6
Inventory turnover
b. Determine the number of days' sales in inventory for 20Y7 and 20Y6. Use 365 days and round to one decimal place.
20Υ7
20Y6
Number of days' sales in inventory
days
days
c. Are the changes in inventory turnover and the number of days' sales in inventory from 20Y6 to 20Y7 favorable or unfavorable?
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Transcribed Image Text:Inventory turnover and number of days' sales in inventory Financial statement data for years ending December 31 for Tango Company follow: 20Υ7 20Y6 Cost of goods sold $3,861,700 $4,080,700 Inventories: Beginning of year 803,000 766,500 End of year 876,000 803,000 Required a. Determine the inventory turnover for 20Y7 and 20Y6. Round to one decimal place. 20Υ7 20Y6 Inventory turnover b. Determine the number of days' sales in inventory for 20Y7 and 20Y6. Use 365 days and round to one decimal place. 20Υ7 20Y6 Number of days' sales in inventory days days c. Are the changes in inventory turnover and the number of days' sales in inventory from 20Y6 to 20Y7 favorable or unfavorable?
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