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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 Vo improve or decline in 2018? 3. Calculate the 2018 gross profit percentage.

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 Vo improve or decline in 2018? 3. Calculate the 2018 gross profit percentage.

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Vo Manufacturing 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, 200 $ 3,660 Cost of Goods Sold 3,470 2,950 Average Inventory 430 370 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 Vo improve or decline in 2018? 3. Calculate the 2018 gross profit percentage. 4. The main competitor for Vo is Arctic Cat. Prior to being acquired by Textron, Incorporated, Arctic Cat reported its inventory turnover was 3.9 and its gross profit percentage was 4.5 percent. Why was Arctic Cat more likely than Vo to require a write-down for LCM/NRV? Complete this question by entering your answers in the tabs below. Req 1A Req 1B Req 2 Req 3 Req 4 Calculate the inventory turnover ratio for 2018 and 2017. (Round your answers to 1 decimal place.) Times per Year 2018 2017 Inventory Turnover Ratio
Transcribed Image Text:Vo Manufacturing 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, 200 $ 3,660 Cost of Goods Sold 3,470 2,950 Average Inventory 430 370 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 Vo improve or decline in 2018? 3. Calculate the 2018 gross profit percentage. 4. The main competitor for Vo is Arctic Cat. Prior to being acquired by Textron, Incorporated, Arctic Cat reported its inventory turnover was 3.9 and its gross profit percentage was 4.5 percent. Why was Arctic Cat more likely than Vo to require a write-down for LCM/NRV? Complete this question by entering your answers in the tabs below. Req 1A Req 1B Req 2 Req 3 Req 4 Calculate the inventory turnover ratio for 2018 and 2017. (Round your answers to 1 decimal place.) Times per Year 2018 2017 Inventory Turnover Ratio
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