Happy Valley Homecare Suppliers, Inc. (HVHS), had $20 million in sales in 2015. Its cost of goods

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Happy Valley Homecare Suppliers, Inc. (HVHS), had $20 million in sales in 2015. Its cost of goods sold was $8 million, and its average inventory balance was $2 million.
a. Calculate the average number of days inventory outstanding ratios for HVHS.
b. The average days of inventory in the industry is 73 days. By how much would HVHS reduce its investment in inventory if it could improve its inventory days to meet the industry average?

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Fundamentals Of Corporate Finance

ISBN: 9780135811603

5th Edition

Authors: Jonathan Berk, Peter DeMarzo, Jarrad Harford

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