The following information for Valdez Industries was taken from the companys financial statements (amounts in thousands): Instructions:
Question:
Instructions:
1. Compute he inventory turnover and the number of days sales in inventory for the years 20062008. Use average inventory in your calculations.
2. Evaluate Valdezs inventory turnovertrend.
Financial statements are the standardized formats to present the financial information related to a business or an organization for its users. Financial statements contain the historical information as well as current period’s financial...
2008 2007 2006 2005 $24,000 19,600 ,400 3,900 2,300 $18,000 3.900 1.200 3.600 1,200 320 $12.000 7.200 Cost of goods sold Accounts receivable Accounts payable 0,200 910 2 1.500 510 3,200 1,800 430 Net income
Step by Step Answer:
1 2008 2007 2006 Inventory x beginning 1200 910 750 Inventory x end 1400 1200 ...View the full answer
Intermediate Accounting
ISBN: 978-0324312140
16th Edition
Authors: James D. Stice, Earl K. Stice, Fred Skousen
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 Managerial Accounting questions
-
The company reported the following information for the year: Beginning accounts receivable . . . . . . . . . . . . . . . . . . . . . . . . . . . . $1,000 Sales . . . . . . . . . . . . . . . . . . . ....
-
The following information for Whittier Technologies was taken from the company's financial statements (amounts in thousands): Instructions: 1. Compute the inventory turnover and the number of days'...
-
The company reported the following information for the year: Ending work-in-process inventory . . . . . . . . . . . . . . . . . . . . . . . . . . . . $100,000 Depreciation on factory building . . . ....
-
Since graduation from college, your friend William has become a highly paid and successful financial advisor. His list of clients is long, and his advice is sought by many. Discuss the merits of the...
-
Smolira Golf Corp. has 25,000 shares of common stock outstanding, and the market price for a share of stock at the end of 2009 was $43. What is the price-earnings ratio? What are the dividends per...
-
A spring has a force function of F(x) = 3x, where x is the displacement from the equilibrium position. If an object with a mass of 2 kg is moved from x = 0 to x = 4 meters, how much work is done by...
-
For the conditions of Problem 8.70, how long must the annulus be if the water flow rate is \(0.35 \mathrm{~kg} / \mathrm{s}\) instead of \(0.02 \mathrm{~kg} / \mathrm{s}\) ? Data From Problem 8.70:-...
-
The double pulley shown has a mass of 14 kg and a centroidal radius of gyration of 165 mm. Cylinder A and block B are attached to cords that are wrapped on the pulleys as shown. The coefficient of...
-
calculates the annual growth rate in expenses or other variables over a multiyear period. puts data on the same relative basis to determine if expenses or other variables are too high or low....
-
In chronological order, the inventory, purchases, and sales of a single product for a recent month are as follows. 1. Using the periodic inventory system, compute the cost of ending inventory , cost...
-
Kimbell Manufacturing began operations five years ago. On August 13, 2008, a fire broke out in the warehouse destroying all inventory and many accounting records relating to the inventory. The...
-
Steve's Repair Shop began operations on January 1, 2003. After discussing the matter with his accountant, Steve decided dollar-value LIFO should be used for inventory costing. Information concerning...
-
Identify the appropriate hypothesis test for each of the following research situations. a. A researcher conducts a between-subjects study to determine whether there is a significant difference in...
-
What are specific examples of why "EU Competition law policy under Article 101 is very supportive of technology innovation. This is manifest in its case law, guidelines and regulation.". Also, cite...
-
4. 5. A drug is to be sold in gelatin capsules, which have an approximately cylindrical shape. To hold the required dosage, the capsules must have a volume of 120 cubic millimeters. What are the...
-
discuss the relationship between symbolic imagery and psychoanalytic theory, particularly in relation to the exploration of unconscious desires, fears, and societal taboos within literature ?
-
Easy Company, a corporation, is considering a variety of equity financing methods. This company routinely pays dividends to its shareholders. It has the option to issue common stock, preferred stock,...
-
Read the case study on how Deloitte helped a large wireless telecommunications company implement platforms to collect, store, and analyze data from across millions of customers and billions of...
-
X Company has four inventory items at year end. Inventory information (based on FIFO) is as follows: Determine X Companys ending inventory using the lower-of-cost-or-market method. Item 1 2 3 Cost...
-
How does health insurance risk differ from other types of insurance risk (e.g., automobile or homeowners insurance)? What is the difference between cost sharing and cost shifting? Is retiree health...
-
Assume the following probability distribution of daily demand for bushels of strawberries: Further assume that unit cost is $3 per bushel, selling price is $5 per bushel, and salvage value on unsold...
-
A campus bookstore has a computerized inventory system. Is it more likely that the system is a periodic system or a perpetual system? Explain.
-
Would you expect to find a perpetual or a periodic inventory system used in each of the following situations? (a) Diamond ring department of a jewelry store (b) Computer department of a college...
-
How is inventory shrinkage computed under a perpetual inventory system?
-
Speculate sales : Speculate on the projected sales. Justify your product or service by the numbers; discuss your projected revenue gain. Note: it MUST have an ROI that justifies the project for...
-
8.6 In Figure P8.6 the experimental unit step response of a process system is shown. (a) What is the transfer function that can be used to best describe the system dynamics among the following. 1 (1)...
-
An 84 year old female arrives to the ER today with her son with a complaint of new onset of confusion. What are your differential diagnoses for a patient with new altered mental status? Go through...
Study smarter with the SolutionInn App