Use the Jeryht Bakers Corp. data to compute the following (amounts in millions): a. The rate of
Question:
a. The rate of inventory turnover for 2017.
b. Days' sales in receivables during 2017. All sales are made on account. Round dollar amounts to three decimal places.
Jeryht Bakers Corp., a baking supplies chain, reported these summarized figures (in millions):
JERYHT BAKERS CORP Balance Sheet December 31 2017 2016 Cash Short-term investments Accounts receivable Inventory Other current assets Total current assets All other assets Total assets 2017 2016 $ 8.8 $ 7.2 8.3 17.4 15.5 4.8 15.711.8 16.6 24.6 21.0 Total liabilities and equity $38.3 $32.1 $ 2.8 0.4 0.5 $1.6 Total current liabilities 0.5 Long-term liabilities 0.4 Total liabilities 8.0 Common shares 0.6 Retained earnings 8.6 5.2 0.8 13.7 11.1 Total equity 20.9 $38.3 $32.1
Step by Step Answer:
a Dollar amounts in millions Inventory turnover Cos...View the full answer
Horngrens Accounting
ISBN: 978-0133855388
10th Canadian edition Volume 2
Authors: Tracie L. Miller Nobles, Brenda L. Mattison, Ella Mae Matsumura, Carol A. Meissner, Jo Ann L. Johnston, Peter R. Norwood
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.
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