Comparative figures for Apple and Google follow. Required 1. Compute inventory turnover for each company for the
Question:
Comparative figures for Apple and Google follow.
Required1. Compute inventory turnover for each company for the most recent two years shown.2. Compute days? sales in inventory for each company for the three years shown.3. In the current year, does (a) Apple?s and (b) Google?s inventory turnover underperform or outperform the industry (assumed) average of 15?
Google Apple One Year Prior Current Year One Year Prior Two Years Prior Current Year Two Years Prior $ ilions $ 2,132 131,376 $ 268 35,138 $ 4,855 141,048 $ 2,349 140,089 $ 749 $ 491 28,164 Inventory.... Cost of sales . 45,583
Step by Step Answer:
1 2 Current year X Apples days sales in inventory 4855141048 x 365 126 days One year prior x Apples ...View the full answer
Financial and Managerial Accounting
ISBN: 978-1260247855
8th edition
Authors: John J Wild, Ken W. Shaw
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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