Chocolate Treats Ltd. and Coffee Bars Inc. are both specialty food chains. The two companies reported these
Question:
Requirements
1. Compute the gross profit percentage and the rate of inventory turnover for Chocolate Treats and for Coffee Bars for 2014.
2. Based on these statistics, which company looks more profitable? Why? What other expense category should we consider in evaluating these two companies?
Chocolate Treats Ltd Statement of Operations Fiscal Year Thousands 2014 2013 Revenues: Net sales. $543 $708 Costs and Expenses: Cost of goods sold General and administrative expenses 475 68 598 Chocolate Treats Ltd. Balance Sheet January 31, Thousands Assets Current assets: 2014 2013 $17 27 24 $28 30 29 Cash and cash equivalents Inventories Coffee Bars Inc. Statement of Earnings Fiscal Year Thousands Net sales Cost of goods sold. Selling, general, and administrative expenses 2014 $7,787 3,179 2,948 2013 $6,369 2,605 2,363 Coffee Bars Inc. Balance Sheet Year End Thousands Assets Current assets: 2014 2013 $313 224 636 $174 191 546 Cash and temporary inv estments Inventories
Step by Step Answer:
Req 1 Chocolate Treats Ltd Coffee Bars Inc Thousands Thousands Gross profit percentage ...View the full answer
Financial Accounting
ISBN: 978-0133472264
5th Canadian edition
Authors: Charles Horngren, William Thomas, Walter Harrison, Greg Berberich, Catherine Seguin
Related Video
Inventory turnover is a key metric that helps businesses evaluate the efficiency of their operations. A high turnover ratio is generally considered positive, indicating that the company is effectively selling its inventory and making efficient use of its resources. On the other hand, a low turnover ratio may indicate issues such as overstocking or slow sales and may require further examination to identify and address the underlying causes. Businesses use this ratio to make decisions about inventory levels, production schedules, and pricing strategies. It also helps businesses to identify areas where they may need to make improvements, such as reducing lead times for production or optimizing sales and marketing efforts. Additionally, inventory turnover is used by investors and analysts as a key performance indicator to evaluate the financial health and growth potential of a company.
Students also viewed these Accounting questions
-
Sprinkle Top and Coffee Shop are both specialty food chains. The two companies reported these figures, in millions: Requirements 1. Compute the gross profit percentage and the rate of inventory...
-
Pastry People and Coffee Grind are both specialty food chains. The two companies reported these figures, in millions: Requirements 1. Compute the gross profit percentage and the rate of inventory...
-
Assume Loblaw Companies Limited reported these figures in millions of dollars: Requirements 1. Compute Loblaw's average collection period during 2014. 2. Was Loblaw's collection period long or short?...
-
Suppose there are two identical forest plots except that one will be harvested and left as is while the second will be cleared after the harvest and turned into a housing development. In terms of...
-
(a) Was Iron Mountains alleged response to Peter Pierces activities legal? (b) Was its response ethical?
-
How would you determine whether a trait you were interested in studying is heritable?
-
\(45 \div 15 \times 6+7^{2}-4 \times 15 \times 18 \div 12 \times 3\) Perform the indicated calculation.
-
Meera Corporation?s comparative balance sheets are presented below. Additional information:1. Net income was $22,630. Dividends declared and paid were $19,500.2. All other changes in noncurrent...
-
The polishing department of Lacroix Manufacturing Company has the following production and manufacturing cost data for September. Materials are entered at the beginning of the process. Production:...
-
On January 15, 2015, Sports World sold 1,000 Ace-5 fishing reels to Angler's Warehouse. Immediately prior to this sale, Sports World perpetual inventory records for Ace-5 reels included the following...
-
AMC Trade Mart has recently had lacklustre sales. The rate of inventory turnover has dropped, and the merchandise is gathering dust. At the same time, competition has forced AMC's suppliers to lower...
-
You are opening a new bookstore catering to the students at Queen's University. Once you have established this operation, you plan to approach investors to support an expansion to locations in other...
-
The first four compounds listed in Table 2.1 contain only carbon and hydrogen. Predict the formulas for these compounds. TABLE 2.1 Relative Mass Data for Several Gases Containing Carbon Compound...
-
A sprinkler system with control mode design area ceiling sprinklers and in-rack sprinklers is protecting a storage warehouse for Group A plastics stored up to 20-ft in height. A separate cross main...
-
We all pay attention to reviews - both good and bad. A survey of TripAdvisor users has revealed that online reviews remain a trusted source of information when booking trips. For accommodation...
-
News Corp has been heavily criticised by investors and fund managers for both large bonuses paid to executives, and its focus on short-term performance. The company recently restructured its...
-
A 0.207 kg particle with an initial velocity of 3.12 m/s is accelerated by a constant force of 3.10 N over a distance of 0.147 m. Use the concept of energy to determine the final velocity of the...
-
When the wavelength for maximum light emission of a scintillator is 450 nm, what is the energy of the light photon?
-
Which organization created the Reporting on an Entitys Cybersecurity Risk Management Program and Controls: Attestation Guide in 2017? a. SEC b. AICPA c. U.S. Congress d. Department of Homeland...
-
You have accepted the engagement of auditing the financial statements of the C. Reis Company, a small manufacturing firm that has been your auditee for several years. Because you were busy writing...
-
Presented on the below are the comparative balance sheets for Lybeck Company at December 31. Additional information:1. Operating expenses include depreciation expense $65,000 and charges from prepaid...
-
The financial statements of Tootsie Roll Industries are presented in Appendix A. Instructions Answer the following questions. (a) What was the amount of net cash provided by operating activities for...
-
The financial statements of The Hershey Company are presented in Appendix B, following the financial statements for Tootsie Roll Industries in Appendix A. Instructions (a) Based on the information in...
-
Select all the costs associated with an employee leaving: Group of answer choices the loss of productivity the cost invested in hiring the employee the creation of a replacement position the cost...
-
Values usually come from a list of priorities that one is consciously aware of . Question 2 1 options: True False
-
Risk management is only done during project planning. Group of answer choices True False
Study smarter with the SolutionInn App