Motion Auto has the following information for the years ending December 31,2010 and 2009:

Requirements 1. Compute the rate of inventory turnover for Motion Auto for the years ended December 31, 2010 and 2009. Round the result to two decimal places.
2. What is a likely cause for the change in the rate of inventory turnover from 2009 to 2010?

Transcribed Image Text:

(In thousands) Sales Revenue 2010 $242 Cost of Goods Sold: Beginning Inventory $ 22 $ 38 2009 $239 Net Purchases 152 144 Cost of Goods Available 174 182 Ending Inventory 13 22 Cost of Goods Sold 161 160 Gross Profit 81 79 Operating Expenses 55 54 Net Income $ 26 $ 25