A convenience store which sells gasoline outside their stores and sells various food items inside their stores reported the following selected information:

Gasoline Merchandise

Sales $1,500,000 $1,710,000

Cost of Goods Sold 1,300,000 1,100,000

Ending Inventory 26,000 94,000

Instructions;

1. Calculate the gross profit percentage for each type of product.
2. Do you think it would be better to continue to allow customers to pay at the pump or would there be a benefit to make the customers come inside the store to make payment?
3. Calculate the Inventory Turnover Ratio for each type of product (since you only have one year, you cannot calculate an average amount, so just use the ending amount)
4. Compute the number of days of inventory outstanding for each type of product (since you only have one year, you cannot calculate an average amount, so just use the ending amount)
5. Why do you think there is such a difference in the two answers for number 4?