The following data (in millions) were adapted from recent financial statements of CVS Health Corporation (CVS): 1.

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The following data (in millions) were adapted from recent financial statements of CVS Health Corporation (CVS):

Year 2 Year 1 Sales Cost of goods sold Operating income Average accounts receivable Average inventory $184,765 156,220 6,631 $177,526 148,669 5,320 12,673 12,026 15,028 14,381


1. Compute the accounts receivable turnover for Years 1 and 2. Round to one decimal place.

2. Compute the days’ sales in receivables for Years 1 and 2. Round to the nearest day.

3. Compute the inventory turnover for Years 1 and 2. Round to one decimal place.

4. Compute the days’ sales in inventory for Years 1 and 2. Round to the nearest day.

5. Compute the return on sales for Years 1 and 2. Round to one decimal place.

6. Comment on CVS’ operations based upon the results in parts (1), (2), (3), (4) and (5).

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Survey Of Accounting

ISBN: 9780357132593

9th Edition

Authors: Carl S. Warren, Amanda Farmer

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