# Question: Q1 Guess the GP and ROS for each of the

Q1. Guess the GP% and ROS for each of the following companies:
GP% ROS
a. Bristol-Myers Squibb (BMY) (pharmaceuticals) (_______ / 40% / 20%) (_______ /20% / 2%)
b. Apple (AAPL) (computers) (70% / _______ / 20%) (25% /_______ / 2%)
c. Kroger (KR) (grocery) (70% / 40% / _______) (25% /20% / _______)
d. What do the above ratios reveal about each of the companies?
e. The information for both the numerator and denominator of the ratios above come from the (balance sheet / _______________ / statement of cash flows).
f. Gross profit margin is the (_______ / second / last) indication of profitability on the income statement.
INVENTORY TURNOVER RATIO
The inventory turnover ratio indicates the number of times a company sells its average inventory level during the year. It measures how efficiently a company uses its investment in inventory. It is a measure of efficiency.
Q2. Guess the inventory turnover ratio for each of the following companies:
a. Wal-Mart—(discount retailer) (4 / ___ / 12 / 35) _______________
b. Kroger—(grocery) (4 / 8 / ___ / 35) _______________
c. Dell Computer—(computer) (4 / 8 / 12 / ___) _______________
d. JC Penney—(department store) (___ / 8 / 12 / 35) _______________
Q3. What does the inventory turnover ratio reveal about each of the companies?
Q4. What are some of the costs of holding inventory?

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