Early in 2014, Chien Company switched to a just-in-time inventory system. Its sales, cost of goods sold,
Question:
Determine the inventory turnover and days in inventory for 2013 and 2014. Discuss the changes in the amount of inventory, the inventory turnover and days in inventory, and the amount of sales across the twoyears.
2013 2014 3,120,000 $3,713,000 Sales Cost of goods sold Beginning inventory Ending inventory 1,200,000 180,000 220,000 1,425,000 220,000 100,000
Step by Step Answer:
2013 2014 Inventory turnover 1200000 6 1425000 89 180000 2200002 220000 1000002 Days in invent...View the full answer
Accounting Principles
ISBN: 9781118566671
11th Edition
Authors: Jerry Weygandt, Paul Kimmel, Donald Kieso
Related Video
Inventory turnover is a key metric that helps businesses evaluate the efficiency of their operations. A high turnover ratio is generally considered positive, indicating that the company is effectively selling its inventory and making efficient use of its resources. On the other hand, a low turnover ratio may indicate issues such as overstocking or slow sales and may require further examination to identify and address the underlying causes. Businesses use this ratio to make decisions about inventory levels, production schedules, and pricing strategies. It also helps businesses to identify areas where they may need to make improvements, such as reducing lead times for production or optimizing sales and marketing efforts. Additionally, inventory turnover is used by investors and analysts as a key performance indicator to evaluate the financial health and growth potential of a company.
Students also viewed these Managerial Accounting questions
-
For each situation given, calculate cost of goods sold and identify if the information provided reflects a perpetual or periodic inventory system. a. b. A physical inventory count at year-end showed...
-
For each situation given, calculate cost of goods sold and identify if the information provided reflects a perpetual or periodic inventory system. a. Merchandise Inventory shows a balance at January...
-
Early in 2012, Aragon Company switched to a just-in-time inventory system. Its sales and inventory amounts for 2011 and 2012 are shown below. Determine the inventory turnover and days in inventory...
-
lim 2sin 71-00 2019 n n+1 + cos 2019 n n+1 is equal to (Answer should be integer)
-
A 0.25-mm-diameter open tubular gas chromatography column is coated with stationary phase that is 0.25 m thick. The diffusion coefficient for a compound with a retention factor k = 10 is Dm = 1.0 ...
-
a . What is the purpose of a T-account? b . Name the three basic parts of a T-account.
-
What is the difference between domain definition and domain dictionary? Give an example for each.
-
On February 1, the Miro Company needs to purchase some office equipment. The company is presently short of cash and expects to be short for several months. The company treasurer has indicated that he...
-
You create a new project roadmap that is visually appealing and contains all the information for the stakeholders to reference. However, this document took a lot of time to create and has caused some...
-
The following information ($ in millions) comes from a recent annual report of Amazon.com, Inc. Net sales.................................................$10,711 Total...
-
(a) Moberg Company sells three different categories of tools (small, medium, and large). The cost and market value of its inventory of tools are as follows. Determine the value of the companys...
-
Tri-State Bank and Trust is considering giving Josef Company a loan. Before doing so, management decides that further discussions with Josefs accountant may be desirable. One area of particular...
-
Explain the types of reconciling items used to adjust from earnings to cash flows from operating activities using the indirect method.
-
Biologists have studied the running ability of the northern quoll, a marsupial indigenous to Australia. In one set of experiments, they studied the maximum speed that quolls could run around a curved...
-
Can nuclei of the same element have different values of \(Z\) ? Of \(N\) ? Of \(A\) ? Can nuclei of different elements have the same values of \(Z\) ? Of \(N\) ? Of \(A\) ?
-
Explain why it is important for statistical inference that given \(\mathbf{x}\) the least squares estimators \(b_{1}\) and \(b_{2}\) are normally distributed random variables.
-
Why is the section of the periodic table labeled as "transition elements" exactly 10 elements wide in all rows?
-
You want to determine whether a tall tree will fit onto your 75 - \(\mathrm{m}\)-long logging trailer after you cut it down. You throw a rock straight up with a speed great enough that the rock just...
-
Oxford researchers say that half of the jobs in America will be computerized over the next 20 years. Robert Cohen, a senior fellow at the Economic Strategy Institute, says cloud computing, Big Data,...
-
PC Contractors, Inc., was an excavating business in Kansas City, Missouri. Union Bank made loans to PC, subject to a perfected security interest in its equipment and other assets, including...
-
The results of a risk assessment help define the audit objectives. A. True B. False
-
Ken Iwig is the president, founder, and majority owner of Olathe Medical Corporation, an emerging medical technology products company. Olathe is in dire need of additional capital to keep operating...
-
Kevin Mathis is confused about the partnership characteristics of (a) Mutual agency (b) Unlimited liability. Explain these two characteristics for Kevin.
-
Lance Kosinski and Matt Morrisen are considering a business venture. They ask you to explain the advantages and disadvantages of the partnership form of organization.
-
Complete Telecom Solution's worksheet for the month ended November 3 0 , 2 0 2 4 . How much was net incoke for November? Requirements 1. 2. Complete Telecom Solution's worksheet for the month ended...
-
Question: Part One: Memo Write an analysis of the impact of tax laws and incentives as demonstrated in this current years tax return. Specifically, you must address the following: Explain the...
-
From the following ledger balances, prepare a trial balance for the Cheyenne Corp. at June 3 0 , 2 0 2 2 . All account balances are normal.Accounts Payable $ 1 0 , 0 0 0 , Cash $ 7 , 4 0 0 , Common...
Study smarter with the SolutionInn App