Early in 2014, Lausanne Company switched to a just-in-time inventory system. Its sales, cost of goods sold,
Question:
Determine the inventory turnover and days in inventory for 2013 and 2014. Discuss the changes in the amount of inventory, the inventory turnover and days in inventory, and the amount of sales across the two years.
2014 2013 Sales Cost of goods sold Beginning inventory CHF3,120,000 1,200,000 CHF3,713,000 1,425,000 180,000 220,000 220,000 100,000 Ending inventory
Step by Step Answer:
The company experienced a very significant decline in its ending inventory as a res...View the full answer
Financial Accounting IFRS
ISBN: 978-1118285909
2nd edition
Authors: Jerry J. Weygandt, Paul D. Kimmel, Donald E. Kieso
Related Video
Inventory turnover is a key metric that helps businesses evaluate the efficiency of their operations. A high turnover ratio is generally considered positive, indicating that the company is effectively selling its inventory and making efficient use of its resources. On the other hand, a low turnover ratio may indicate issues such as overstocking or slow sales and may require further examination to identify and address the underlying causes. Businesses use this ratio to make decisions about inventory levels, production schedules, and pricing strategies. It also helps businesses to identify areas where they may need to make improvements, such as reducing lead times for production or optimizing sales and marketing efforts. Additionally, inventory turnover is used by investors and analysts as a key performance indicator to evaluate the financial health and growth potential of a company.
Students also viewed these Business questions
-
Early in 2014, Racine Company switched to a just-in-time inventory system. Its sales, cost of goods sold, and inventory amounts for 2013 and 2014 are shown below. Determine the inventory turnover and...
-
Early in 2014, Chien Company switched to a just-in-time inventory system. Its sales, cost of goods sold, and inventory amounts for 2013 and 2014 are shown below. Determine the inventory turnover and...
-
Early in 2014, Defoor Company switched to a just-in-time inventory system. Its sales and inventory amounts for 2013 and 2014 are shown below. Determine the inventory turnover and days in inventory...
-
On August 31, 2014, Nina Herrera borrowed $5,000 from Second State Bank. Herrera signed a note payable, promising to pay the bank principal plus interest on August 31, 2015. The interest rate on the...
-
How does the risk of short-term funds differ from the risk of long-term funds? Discuss.
-
Using TELUS's financial statements that appear in Appendix A at the end of this book , answer the following: (Note: TELUS's total assets were $19,525 and its common shareholders' equity was $7,334 at...
-
Two factors are thought to influence the deposition rate (seconds) for a pulse laser to deposit one monolayer of material. Initially, a \(2^{2}\) design was run with two factors: spot size \(50...
-
The city of Glendale borrows $48 million by issuing municipal bonds to help build the Arizona Cardinals football stadium. It plans to set up a sinking fund that will repay the loan at the end of 10...
-
What is the maximum axial force that can be applied to a part if the cross-sectional area is given as A = 0.05 cm2 , n=2 and tensile strength is given as 100 MPa.
-
In FASB Statement of Concepts No. 2, several qualitative characteristics of useful accounting information were identified. The following is a list of these qualities as well as a list of statements...
-
Information about Sherpers Boards is presented in E6-4. Additional data regarding Sherpers sales of Xpert snowboards are provided below. Assume that Sherpers uses a perpetual inventory system....
-
Recife Company just took its physical inventory. The count of inventory items on hand at the companys business locations resulted in a total inventory cost of R$300,000. In reviewing the details of...
-
This case describes one firm's approach to improving employee retention. (For the case, go to www.cengage.com/management/mathis or visit the instructor companion website.) Discuss how the culture of...
-
Use $20,000 of your client's account in the two foreign currencies which you have selected to invest in based on a margin of 2% which gives you a high leverage (50 to 1), meaning you can invest up to...
-
Calculate final RTO if initial RTO is 6s; Seg 1 sent at 0s, Seg 2 sent at 2s, ACKs for Seg 1 and Seg 2 are received at 5s, Seg3 sent at 8s, Seg 4 sent at 9s, ACKs for Seg3 & Seg4 lost, Seg3 and Seg4...
-
K How many Canadian dollars can you buy for US$871.00 if one Canadian dollar is worth US$0.7348? You can purchase C$ (Round to the nearest cent as needed.)
-
How are the acceleration and velocity oriented with respect to each other? (2pt) What would happen to the orbiting object if gravity was suddenly cut off? (2pt) Application: How is the water removed...
-
An investor wishes to construct a portfolio by borrowing 35 percent of his original wealth and investing all the money in a stock index. The return on the risk-free asset is 4.0 percent, and the...
-
Graph the equation by plotting points. y - 4x = 8
-
Write the given system without the use of matrices. D) - ()- d (x sin t + 8 (2+ 1)
-
A recent income statement for McDonalds Corporation shows cost of goods sold $4,852.7 million and operating expenses (including depreciation expense of $1,201 million) $10,671.5 million. The...
-
A recent income statement for McDonalds Corporation shows cost of goods sold $4,852.7 million and operating expenses (including depreciation expense of $1,201 million) $10,671.5 million. The...
-
The 2010 accounting records of Verlander Transport reveal these transactions and events. InstructionsPrepare the cash flows from operating activities section using the direct method. (Not all of the...
-
The trial balance for a company listed the following account balances at December 31, Year 1, the end of its fiscal year: cash, $36,000; accounts receivable. $31,000; Inventory, $45,000; equipment...
-
A corporation issues 13 %, 15-year bonds with a par value of $570,000 and semiannual interest payments. On the issue date, the annual market rate for these bonds is 11%, which implies a selling price...
-
If you were asked whether a large university such as Tennessee or Michigan with a large seating capacity for their football stadiums should build a new football stadium, how would you respond and...
Study smarter with the SolutionInn App