Its Good, Y All! is a Texas-based company that operates a large chain of restaurants. The following

Question:

It€™s Good, Y€™ All! is a Texas-based company that operates a large chain of restaurants. The following information is available for the company (in thousands).

Required:
(a) Compute the company€™s inventory turnover ratio and age of inventory for 2007 through 2009. Beginning inventory for 2007 was $15,746,000.
(b) Comment on the ratios computed in part (a). Are there any deï¬nite trends in these ratios? If so, are these trends favorable or unfavorable? Explain.
(c) Why do decision makers pay close attention to the age of inventory statistic for companies in the restaurant industry?

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,...