Refer to the financial statements of The Home Depot in Appendix A and Lowe’s in Appendix B at the end of this book, or download the annual reports from the Cases section in the Connect library.
1. Does Lowe’s hold more or less inventory than The Home Depot at the end of January 2014?
2. Does Lowe’s follow the lower of cost or market rule? What method does Lowe’s use to deter-mine the cost of its inventory? Comment on how this affects comparisons you might make between Lowe’s and The Home Depot’s inventory turnover ratios.
3. Compute to one decimal place Lowe’s inventory turnover ratio and days to sell for the year ended January 31, 2014, and compare to The Home Depot’s. What does this analysis suggest to you?

  • CreatedNovember 02, 2015
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