Assume that for the 2013 fiscal year, AstroCo reported sales revenue of $2.8 billion and cost of

Question:

Assume that for the 2013 fiscal year, AstroCo reported sales revenue of $2.8 billion and cost of goods sold of $1.6 billion.

Fiscal Year 2013 2012 (amounts in millions) $ 70 Balance Sheet $ 35 Cash Accounts Receivable, less allowance of $15 and

Required
Assuming that all sales are on credit, compute the current ratio (rounded to two decimal places), inventory turnover ratio (rounded to one decimal place), and accounts receivable turn- over ratio (rounded to one decimal place) for 2013. Explain what each ratio means for AstroCo?

Inventory Turnover Ratio
Inventory Turnover RatioThe inventory turnover ratio is a ratio of cost of goods sold to its average inventory. It is measured in times with respect to the cost of goods sold in a year normally. Inventory Turnover Ratio FormulaWhere,...