Refer to the data in BE 6-15 for Reynold's Company. Assume for 2013 the company had an

Question:

Refer to the data in BE 6-15 for Reynold's Company. Assume for 2013 the company had an of 9.1 and 40.1 days sales in inventory. Has the company's inventory management improved or deteriorated in 2014? Explain.
IN BE 6-15
Reynold's Company had net sales of $2,500,000, cost of goods sold of $1,150,000, and profit of $500,000 in 2014. The company had a January 1, 2014, inventory balance of $132,000 and a December 31, 2014, inventory balance of $143,000. Calculate the inventory turnover and days sales in inventory ratios for 2014.
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,...