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Exercise 6-58 Analyzing Inventory The recent financial statements of McLelland Clothing Inc. include the following data: Sales $754,690 Cost of goods sold: Computed under FIFO 528,600 Computed under LIFO 555,000 Average inventory: Computed under FIFO 72,200 Computed under LIFO 45,800 Required: 1. Calculate McLelland's gross profit ratio (rounded to two decimal places), inventory turnover ratio (rounded to three decimal places), and the average days to sell inventory (assume a 365- day year and round to two decimal places) using the FIFO inventory costing method. Gross profit ratio 29.96 % Inventory turnover ratio 7.321 Average days to sell inventory 49.86 days 2. Calculate McLelland's gross profit ratio (rounded to two decimal places), inventory turnover ratio (rounded to three decimal places), and the average days to sell inventory (assume a 365- day year and round to two decimal places) using the LIFO inventory costing method. Gross profit ratio 26.45 X % Inventory turnover ratio 12.118 Average days to sell inventory 30.12 days 3. Conceptual Connection: Which ratios-the ones computed using FIFO or LIFO inventory values-provide the better indicator of how successful McLelland was at managing and controlling its inventory? FIFO