On January 1, 2024, the general ledger of Big Blast Fireworks includes the following account balances:

Accounts	Debit	Credit
Cash	$25,900
Accounts Receivable	46,500
Allowance for Uncollectible Accounts		$4,300
Inventory	50,000
Land	91,600
Accounts Payable		25,200
Notes Payable (9%, due in 3 years)		50,000
Common Stock		76,000
Retained Earnings		58,500
Totals	$214,000	$214,000

The $50,000 beginning balance of inventory consists of 500 units, each costing $100. During January 2024, Big Blast Fireworks had the following inventory transactions:

January 3	Purchase 1,850 units for $209,050 on account ($113 each).
January 8	Purchase 1,950 units for $230,100 on account ($118 each).
January 12	Purchase 2,050 units for $252,150 on account ($123 each).
January 15	Return 200 of the units purchased on January 12 because of defects.
January 19	Sell 6,000 units on account for $900,000 The cost of the units sold is determined using a FIFO perpetual inventory system.
January 22	Receive $881,000 from customers on accounts receivable.
January 24	Pay $650,000 to inventory suppliers on accounts payable.
January 27	Write off accounts receivable as uncollectible, $2,900.
January 31	Pay cash for salaries during January, $139,000.

The following information is available on January 31, 2024.

1. At the end of January, the company estimates that the remaining units of inventory purchased on January 12 are expected to sell in February for only $100 each. [Hint: Determine the number of units remaining from January 12 after subtracting the units returned on January 15 and the units assumed sold (FIFO) on January 19.]
2. The company records an adjusting entry for $3,830. for estimated future uncollectible accounts.
3. The company accrues interest on notes payable for January. Interest is expected to be paid each December 31.
4. The company accrues income taxes at the end of January of $14,300.

Analyze how well Big Blast Fireworks manages its inventory. (Enter your inventory turnover ratio and gross profit ratio values to one decimal place.)

Analyze how well Big Blast Fireworks manages its inventory:
(a) Calculate the inventory turnover ratio for the month of January. If the industry average of the inventory turnover ratio for the month of January is 18 times, is the company managing its inventory more or less efficiently than other companies in the same industry?
The inventory turnover ratio is:		times
Is the company managing its inventory more or less efficiently than other companies in the same industry?
(b) Calculate the gross profit ratio for the month of January. If the industry average gross profit ratio is 28%, is the company more or less profitable per dollar of sales than other companies in the same industry?
The gross profit ratio is:		%
Is the company more or less profitable per dollar of sales than other companies in the same industry?
(c) Used together, what might the inventory turnover ratio and gross profit ratio suggest about Big Blast Fireworks business strategy? Is the companys strategy to sell a higher volume of less expensive items or does the company appear to be selling a lower volume of more expensive items?
Based on the inventory turnover ratio and the gross profit ratio, Big Blast Fireworks business strategy appears to be selling a