Inventory Turnover Ratio: Inventory Turnover Ratio measures the efficiency of the company in converting its inventory into sales. It is calculated by dividing the Cost of goods sold by Average inventory. The formula of the Inventory Turnover Ratio is as follows: I n v e n t o r y T u r n o v e r R a t i o = C o s t o f g o o d s s o l d A v e r a g e i n v e n t o r y Note: Average inventory is calculated with the help of following formula: A v e r a g e i n v e n t o r y = ( B e g i n n i n g i n v e n t o r y + E n d i n g i n v e n t o r y ) 2 Day’s sales in inventory: Days sales in inventory represent the number of days the inventory waits for the sale. It is calculated by dividing the 365 days by Inventory Turnover Ratio. The formula of the Days sales in inventory is as follows: D a y s s a l e s i n i n v e n t o r y = 365 I n v e n t o r y T u r n o v e r R a t i o To determine: The Inventory turnover ratio and days sales in inventory for 2017 and 2016 and comment on the company’s efficiency to increase sales from 2016 to 2017.

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Answer 1

Question

Chapter 6, Problem 13E

To determine

Concept Introduction:

Inventory Turnover Ratio: Inventory Turnover Ratio measures the efficiency of the company in converting its inventory into sales. It is calculated by dividing the Cost of goods sold by Average inventory. The formula of the Inventory Turnover Ratio is as follows:

$I n v e n t o r y T u r n o v e r R a t i o = \frac{C o s t o f g o o d s s o l d}{A v e r a g e i n v e n t o r y}$

Note: Average inventory is calculated with the help of following formula:

$A v e r a g e i n v e n t o r y = \frac{(B e g i n n i n g i n v e n t o r y + E n d i n g i n v e n t o r y)}{2}$

Day’s sales in inventory: Days sales in inventory represent the number of days the inventory waits for the sale. It is calculated by dividing the 365 days by Inventory Turnover Ratio. The formula of the Days sales in inventory is as follows:

$D a y s s a l e s i n i n v e n t o r y = \frac{365}{I n v e n t o r y T u r n o v e r R a t i o}$

To determine: The Inventory turnover ratio and days sales in inventory for 2017 and 2016 and comment on the company’s efficiency to increase sales from 2016 to 2017.

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I am looking for the most effective method for solving this financial accounting problem.

Answer 2

Question

Chapter 6, Problem 13E

To determine

Concept Introduction:

Inventory Turnover Ratio: Inventory Turnover Ratio measures the efficiency of the company in converting its inventory into sales. It is calculated by dividing the Cost of goods sold by Average inventory. The formula of the Inventory Turnover Ratio is as follows:

$I n v e n t o r y T u r n o v e r R a t i o = \frac{C o s t o f g o o d s s o l d}{A v e r a g e i n v e n t o r y}$

Note: Average inventory is calculated with the help of following formula:

$A v e r a g e i n v e n t o r y = \frac{(B e g i n n i n g i n v e n t o r y + E n d i n g i n v e n t o r y)}{2}$

Day’s sales in inventory: Days sales in inventory represent the number of days the inventory waits for the sale. It is calculated by dividing the 365 days by Inventory Turnover Ratio. The formula of the Days sales in inventory is as follows:

$D a y s s a l e s i n i n v e n t o r y = \frac{365}{I n v e n t o r y T u r n o v e r R a t i o}$

To determine: The Inventory turnover ratio and days sales in inventory for 2017 and 2016 and comment on the company’s efficiency to increase sales from 2016 to 2017.

Expert Solution & Answer

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Check out a sample textbook solution

See solution

Answer 3

Question

Chapter 6, Problem 13E

To determine

Concept Introduction:

Inventory Turnover Ratio: Inventory Turnover Ratio measures the efficiency of the company in converting its inventory into sales. It is calculated by dividing the Cost of goods sold by Average inventory. The formula of the Inventory Turnover Ratio is as follows:

$I n v e n t o r y T u r n o v e r R a t i o = \frac{C o s t o f g o o d s s o l d}{A v e r a g e i n v e n t o r y}$

Note: Average inventory is calculated with the help of following formula:

$A v e r a g e i n v e n t o r y = \frac{(B e g i n n i n g i n v e n t o r y + E n d i n g i n v e n t o r y)}{2}$

Day’s sales in inventory: Days sales in inventory represent the number of days the inventory waits for the sale. It is calculated by dividing the 365 days by Inventory Turnover Ratio. The formula of the Days sales in inventory is as follows:

$D a y s s a l e s i n i n v e n t o r y = \frac{365}{I n v e n t o r y T u r n o v e r R a t i o}$

To determine: The Inventory turnover ratio and days sales in inventory for 2017 and 2016 and comment on the company’s efficiency to increase sales from 2016 to 2017.

Expert Solution & Answer

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See solution

Answer 4

Question

Chapter 6, Problem 13E

To determine

Concept Introduction:

Inventory Turnover Ratio: Inventory Turnover Ratio measures the efficiency of the company in converting its inventory into sales. It is calculated by dividing the Cost of goods sold by Average inventory. The formula of the Inventory Turnover Ratio is as follows:

$I n v e n t o r y T u r n o v e r R a t i o = \frac{C o s t o f g o o d s s o l d}{A v e r a g e i n v e n t o r y}$

Note: Average inventory is calculated with the help of following formula:

$A v e r a g e i n v e n t o r y = \frac{(B e g i n n i n g i n v e n t o r y + E n d i n g i n v e n t o r y)}{2}$

Day’s sales in inventory: Days sales in inventory represent the number of days the inventory waits for the sale. It is calculated by dividing the 365 days by Inventory Turnover Ratio. The formula of the Days sales in inventory is as follows:

$D a y s s a l e s i n i n v e n t o r y = \frac{365}{I n v e n t o r y T u r n o v e r R a t i o}$

To determine: The Inventory turnover ratio and days sales in inventory for 2017 and 2016 and comment on the company’s efficiency to increase sales from 2016 to 2017.

Expert Solution & Answer

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Check out a sample textbook solution

See solution

Answer 5

Chapter 6, Problem 13E

To determine

Concept Introduction:

Inventory Turnover Ratio: Inventory Turnover Ratio measures the efficiency of the company in converting its inventory into sales. It is calculated by dividing the Cost of goods sold by Average inventory. The formula of the Inventory Turnover Ratio is as follows:

$I n v e n t o r y T u r n o v e r R a t i o = \frac{C o s t o f g o o d s s o l d}{A v e r a g e i n v e n t o r y}$

Note: Average inventory is calculated with the help of following formula:

$A v e r a g e i n v e n t o r y = \frac{(B e g i n n i n g i n v e n t o r y + E n d i n g i n v e n t o r y)}{2}$

Day’s sales in inventory: Days sales in inventory represent the number of days the inventory waits for the sale. It is calculated by dividing the 365 days by Inventory Turnover Ratio. The formula of the Days sales in inventory is as follows:

$D a y s s a l e s i n i n v e n t o r y = \frac{365}{I n v e n t o r y T u r n o v e r R a t i o}$

To determine: The Inventory turnover ratio and days sales in inventory for 2017 and 2016 and comment on the company’s efficiency to increase sales from 2016 to 2017.

Answer 6

Chapter 6, Problem 13E

To determine

Concept Introduction:

Inventory Turnover Ratio: Inventory Turnover Ratio measures the efficiency of the company in converting its inventory into sales. It is calculated by dividing the Cost of goods sold by Average inventory. The formula of the Inventory Turnover Ratio is as follows:

$I n v e n t o r y T u r n o v e r R a t i o = \frac{C o s t o f g o o d s s o l d}{A v e r a g e i n v e n t o r y}$

Note: Average inventory is calculated with the help of following formula:

$A v e r a g e i n v e n t o r y = \frac{(B e g i n n i n g i n v e n t o r y + E n d i n g i n v e n t o r y)}{2}$

Day’s sales in inventory: Days sales in inventory represent the number of days the inventory waits for the sale. It is calculated by dividing the 365 days by Inventory Turnover Ratio. The formula of the Days sales in inventory is as follows:

$D a y s s a l e s i n i n v e n t o r y = \frac{365}{I n v e n t o r y T u r n o v e r R a t i o}$

To determine: The Inventory turnover ratio and days sales in inventory for 2017 and 2016 and comment on the company’s efficiency to increase sales from 2016 to 2017.

Answer 7

Chapter 6, Problem 13E

To determine

Concept Introduction:

Inventory Turnover Ratio: Inventory Turnover Ratio measures the efficiency of the company in converting its inventory into sales. It is calculated by dividing the Cost of goods sold by Average inventory. The formula of the Inventory Turnover Ratio is as follows:

$I n v e n t o r y T u r n o v e r R a t i o = \frac{C o s t o f g o o d s s o l d}{A v e r a g e i n v e n t o r y}$

Note: Average inventory is calculated with the help of following formula:

$A v e r a g e i n v e n t o r y = \frac{(B e g i n n i n g i n v e n t o r y + E n d i n g i n v e n t o r y)}{2}$

Day’s sales in inventory: Days sales in inventory represent the number of days the inventory waits for the sale. It is calculated by dividing the 365 days by Inventory Turnover Ratio. The formula of the Days sales in inventory is as follows:

$D a y s s a l e s i n i n v e n t o r y = \frac{365}{I n v e n t o r y T u r n o v e r R a t i o}$

To determine: The Inventory turnover ratio and days sales in inventory for 2017 and 2016 and comment on the company’s efficiency to increase sales from 2016 to 2017.

Answer 8

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Answer 11

Ch. 6 - Prob. 1DQ Ch. 6 - 2. Where is the amount of merchandise inventory...Ch. 6 - Prob. 3DQ Ch. 6 - Prob. 4DQ Ch. 6 - What does the full disclosure principle prescribe...Ch. 6 - Prob. 6DQ Ch. 6 - Prob. 7DQ Ch. 6 - Prob. 8DQ Ch. 6 - Prob. 9DQ Ch. 6 - What is the meaning of market as it is used in...

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