Identify and describe the ratio that can be used to analyze a company's inventory. What does the
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Question:
Identify and describe the ratio that can be used to analyze a company's inventory.
What does the ratio measure? What are the components of the ratio? How is the ratio computed?
How does a company know if the results of the calculation are helping or hurting the company's financial health?
Given the following information, calculate the inventory turnover for Lincoln Company, a large grocery store chain. Evaluate the trend results.
2014: Cost of goods sold—$1,043,000; Beginning inventory—$283,000; Ending inventory—$264,000.
2013: Cost of goods sold—$820,000; Beginning inventory—$311,000; Ending inventory—$283,000.
Related Book For
Auditing and Assurance Services A Systematic Approach
ISBN: 978-1259162343
9th edition
Authors: William Messier, Steven Glover, Douglas Prawitt
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