Osborne Organic Foods, Inc., has the following information for the years ending December 31, 2016 and 2015:

Requirements
1. Compute the rate of inventory turnover for Osborne Organic Foods, Inc., for the years ended December 31, 2016 and 2015. Round the result to two decimal places.
2. Compute the days-sales-in-inventory for Osborne Organic Foods, Inc., for the years ended December 31, 2016 and 2015.
3. What is a likely cause for the change in the rate of inventory turnover from 2015 to 2016?

Transcribed Image Text:

2016 $243,000 2016 $237,000 Sales Revenue Cost of Goods Sold: $ 8,000 126,000 134,000 $ 12,000 139,000 Beginning Inventory Net Purchases Cost of Goods Available 151,000 26,000 Ending Inventory 12,000 125,000 118,000 122,000 Cost of Goods Sold Gross Profit 115,000 Operating Expenses Net Income 42,000 38,000 $ 77,000 $ 76,000