Amazon.com’s financial statements in Appendix A at the end of this book reveal some interesting relationships. Answer these questions about Amazon:
Requirements
1. Compute trend analyses for net sales and net income. Use 2007 as the base year. What is the most notable aspect of this data?
2. Compute inventory turnover for 2009 and 2008. The inventory balance at December 31, 2009, was $2,171 million. Do the trend of net income from 2008 to 2009 and the change in the rate of inventory turnover tell the same story or a different story? Explain your answer.