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I've watched the practice videos and still cannot understand the inventory turnover ratio Inventory turnover and number of days' sales in inventory Financial statement data
I've watched the practice videos and still cannot understand the inventory turnover ratio
Inventory turnover and number of days' sales in inventory Financial statement data for years ending December 31 for Tango Company follow: a. Determine the inventory turnover for 20Y7 and 20Y6. Round your answers to one decimal place. b. Determine the days' sales in inventory for 20Y7 and 20Y6. Use 365 days a year. Round your answers to one decimal place. c. Are the changes in inventory turnover and the number of days' sales in inventory from 20Y6 to 20Y7 favorable or unfavorable? Feedback Check My Work a. The inventory turnover ratio indicates how many times a company has sold and replaced inventory during a period. The inventory turnover ratio is calculated by dividing the cost of g b. Number of days' sales in inventory indicates the average time required for a company to convert its inventory into sales. The calculation of the number of days' sales in inventory is th c. A high ratio implies either strong sales or large discountsStep by Step Solution
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