Alibaba Group

Financial Information:

• Beginning Inventory: $3,700,000
• Purchases: $11,000,000
• Ending Inventory: $3,300,000
• Net Sales: $19,000,000
• Operating Expenses: $5,500,000

Requirements:

1. Develop the Cost of Goods Sold (COGS) statement.
2. Calculate the Gross Profit.
3. Compute the Inventory Turnover Ratio.
4. Prepare a partial Income Statement showing Net Sales, COGS, and Gross Profit.
5. Discuss the implications of Alibaba's inventory turnover ratio on its e-commerce operations and market responsiveness.