Examining the recent financial statements of McLelland Clothing, Inc., you note the following: Sales ............. $754,693 Cost

Question:

Examining the recent of McLelland Clothing, Inc., you note the following:
Sales ............. $754,693
Cost of goods sold ....... 528,600
Average inventory ........ 76,900

Required:
Calculate McLelland’s gross profit ratio, , and assuming a 365-day year, the average days to sell inventory. Be sure to explain what each ratio means.

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,... Financial Statements
Financial statements are the standardized formats to present the financial information related to a business or an organization for its users. Financial statements contain the historical information as well as current period’s financial...