QUESTION:

DATA FOR QUESTION:

JU 31 4. For Scenarios 2 through 4, explain what change occurred relative to Scenario 1 to cause the gross margin return on inventory (GMROI) to change. You need to specifically discuss each scenario change separately in comparison to scenario 1 by discussing the changes in the gross margin percent and inventory 32 turnover. 33 Tyne your resnonse into the text box below 1 Part 2 3 Below are data for four scenarios. Scenario 1 is the base scenario and the other 3 scenarios are modifications to the base scenario. 6 Sales 7 Cost of Goods Sold 3 Gross Profit Scenario 1 Scenario 2 Scenario 3 Scenario 4 $10,000 $20,000 $10,000 $10,000 8,000 10,000 6,000 8,000 $2,000 $10,000 $4,000 $2,000 10 Average Inventory $5,000 $5,000 $5,000 $ 4.000 13 Required: Answer the questions below each question and use cell references for calculations. 14 1. Compute the gross margin percent for each scenario. Scenario 1 Scenario 2 Scenario 3 Scenario 4 Gross Margin 17 Percent 20% 50% 40% 20% 18 19 2. Compute the inventory turnover for each scenario. Scenario 1 Scenario 2 Scenario 3 Scenario 4 1.60 2.00 1.20 2.00 22 Inventory Turnover - 3. Compute the gross margin return on inventory investment percent for each scenario. Scenario 1 Scenario 2 Scenario 3 Scenario 4 the createns toen 20 Gross margin return on inventory investment . oo sol 40.00% 200.00% 80.00% 50.00%