Inventory turnover ratio: Inventory turnover ratio is used to determine the number of times inventory used or sold during the particular accounting period. The formula to calculate the inventory turnover ratio is as follows: Inventory turnover = Cost of goods sold Average inventory Days’ sales in inventory: Days’ sales in inventory are used to determine number of days a particular company takes to make sales of the inventory available with them. The formula to calculate the days’ sales in inventory ratio is as follows: Days' sales in inventory = Days in accounting period Inventory turnover inventory turnover for 2016 and 2015.
Inventory turnover ratio: Inventory turnover ratio is used to determine the number of times inventory used or sold during the particular accounting period. The formula to calculate the inventory turnover ratio is as follows: Inventory turnover = Cost of goods sold Average inventory Days’ sales in inventory: Days’ sales in inventory are used to determine number of days a particular company takes to make sales of the inventory available with them. The formula to calculate the days’ sales in inventory ratio is as follows: Days' sales in inventory = Days in accounting period Inventory turnover inventory turnover for 2016 and 2015.
Solution Summary: The author explains the inventory turnover ratio, which is used to determine the number of times inventory used or sold during the particular accounting period.
Inventory turnover ratio: Inventory turnover ratio is used to determine the number of times inventory used or sold during the particular accounting period. The formula to calculate the inventory turnover ratio is as follows:
Inventory turnover=Cost of goods soldAverage inventory
Days’ sales in inventory: Days’ sales in inventory are used to determine number of days a particular company takes to make sales of the inventory available with them. The formula to calculate the days’ sales in inventory ratio is as follows:
Days' sales in inventory=Days in accounting periodInventory turnover
inventory turnover for 2016 and 2015.
(b)
To determine
Days’ sales in inventory ratio for 2016 and 2015.
(c)
To determine
To explain: if change in turnover and days’ sales in inventory from 2015 to 2016 indicate favorable or unfavorable trend.
Sp25 ACCT X CengageNOWv2 | Online teaching X
exhibit 6.4.jpg 71x399)
x +
bw.com/ilrn/takeAssignment/takeAssignmentMain.do?inprogress=true
FIFO perpetual inventory
The beginning inventory at Dunne Co. and data on purchases and sales for a three-month period ending June 30 are
Number
Date Transaction
of Units
Per Unit
Total
Apr. 3 Inventory
25
$1,200
$30,000
8 Purchase
75
1,240
93,000
11 Sale
40
2,000
80,000
30 Sale
30
2,000
60,000
May 8 Purchase
60
1,260
75,600
10 Sale
50
2,000
100,000
19 Sale
20
2,000
40,000
<
28 Purchase
80
1,260
100,800
June 5 Sale
40
2,250
90,000
16 Sale
25
2,250
56,250
21 Purchase
35
1,264
44,240
28 Sale
44
2,250
99,000
Required:
1. Record the inventory, purchases, and cost of goods sold data in a perpetual inventory record similar to the one illust
first-in, first-out method. Under FIFO, if units are in inventory at two different costs, enter the units with the LOWER un
Check My Work 3 more Check My Work uses remaining
Q Search
hp
PLEASE HELP! NOTICE. THERE ARE FIVE CELLS ON THE LEFT SIDE TO FILL. THE DROPDOWN SHOWS THE OPTIONS FOR THESE CELLS.
Calm Ltd has the following data relating tò two investment projects, only one of which mayb e s e l e c t e d :The cost of capital is 10 per cent, and depreciation is calculated using straight line method.a . Calculate for each of the project:i. Average annual accounting rate of return on average capital investedi i . Net Present Valuei l l . I n t e r n a l R a t e o f Returnb. Discuss the relative merits of the methods of evaluation mentioned above in (a).Q.4a . In the context of process costing, discuss the following concepts briefly, i . Equivalent unitsNormal lossill. Abnormal lossi v. Joint productsV . By productsb . Discuss the different types of standard costing and objectives of standard costing.
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.