ACME's COO is interested in measuring ACME's Inventory performance against the general performance of other firms...

 

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ACME's COO is interested in measuring ACME's Inventory performance against the general performance of other firms in the industry. He has decided that Inventory Turns is the best measure of performance given ACME's emphasis on the retail business. The relevant financial information is as follows: ACME Income Statement ($m) ACME Balance Sheet ($m) Revenue 5,000 Current Assets Cost of Goods Sold 3,000 Inventory Gross Profit 400 2,000 Accounts Receivables 150 Sales, general & Administrative Expenses 1,000 Cash 50 Earnings before Interest & taxes 1,000 Total Current Assets 600 Interest and Taxes Net Income 500 Current Liabilities 500 Accounts Payables 450 Short-Term Debt 100 Total Current Liabilities 550 The Average Inventory Turns for the industry is 14. Is ACME's Inventory performance Better than the Industry Average Worse than the Industry Average The Same as the Industry Average ACME's COO is interested in measuring ACME's Inventory performance against the general performance of other firms in the industry. He has decided that Inventory Turns is the best measure of performance given ACME's emphasis on the retail business. The relevant financial information is as follows: ACME Income Statement ($m) ACME Balance Sheet ($m) Revenue 5,000 Current Assets Cost of Goods Sold 3,000 Inventory Gross Profit 400 2,000 Accounts Receivables 150 Sales, general & Administrative Expenses 1,000 Cash 50 Earnings before Interest & taxes 1,000 Total Current Assets 600 Interest and Taxes Net Income 500 Current Liabilities 500 Accounts Payables 450 Short-Term Debt 100 Total Current Liabilities 550 The Average Inventory Turns for the industry is 14. Is ACME's Inventory performance Better than the Industry Average Worse than the Industry Average The Same as the Industry Average

Answer rating: 100% (QA)

To determine ACMEs inventory performance we can calculate its inventory turn... View the full answer