Inventory Turnover and Days' Sales in Inventory The Southern Company installed a new inventory management system at the beginning of Year 1. Shown below are data from the company's accounting records as reported by the new system: Year 1 Year 2 Sales revenue $8,000,000 $10,000,000 Cost of goods sold 4,000,000 4,900,000 Beginning inventory 500,000 530,000 Ending inventory 530,000 600,000 Calculate the company's (a) inventory turnover and (b) days' sales in inventory for both years. Round to two decimals. Use the rounded answers in your calculations. Year 1 Year 2 (a) Inventory turnover (b) Days' sales in inventory lo o
Inventory Turnover and Days' Sales in Inventory The Southern Company installed a new inventory management system at the beginning of Year 1. Shown below are data from the company's accounting records as reported by the new system: Year 1 Year 2 Sales revenue $8,000,000 $10,000,000 Cost of goods sold 4,000,000 4,900,000 Beginning inventory 500,000 530,000 Ending inventory 530,000 600,000 Calculate the company's (a) inventory turnover and (b) days' sales in inventory for both years. Round to two decimals. Use the rounded answers in your calculations. Year 1 Year 2 (a) Inventory turnover (b) Days' sales in inventory lo o
Chapter1: Financial Statements And Business Decisions
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Transcribed Image Text:Inventory Turnover and Days' Sales in Inventory
The Southern Company installed a new inventory management system at the beginning of Year 1.
Shown below are data from the company's accounting records as reported by the new system:
Year 1
Year 2
Sales revenue
$8,000,000 $10,000,000
Cost of goods sold
4,000,000
4,900,000
Beginning inventory
500,000
530,000
Ending inventory
530,000
600,000
Calculate the company's (a) inventory turnover and (b) days' sales in inventory for both years.
Round to two decimals. Use the rounded answers in your calculations.
Year 1
Year 2
(a) Inventory turnover
(b) Days' sales in inventory
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