Claremont Corp. has the following inventory balances for 2009: beginning, $468,000; ending, $444,000. The companys Cost of

Question:

Claremont Corp. has the following inventory balances for 2009: beginning, $468,000; ending, $444,000. The company’s Cost of Goods Sold for the year was $4,370,400.
Required:
(a) What is Claremont Corp.’s average inventory for 2009?
(b) What is the company’s ?
(c) Calculate the average age of inventory for Claremont Corp.
(d) Assume that Claremont Corp. is a retail toy company, and its ﬁscal year-end is December 31. Would Claremont’s inventory be at an annual high or low at the end of the year? In this situation, would the provide valid information to a decision maker? Why or why not?
(e) Given the information in part (d), how might you obtain a better indication of the average amount of inventory that Claremont Corp. had on hand during the year?
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,...