Question 4:

Inventory Management at DEF Ltd.

Given the following data for DEF Ltd.:

• Beginning Inventory: $80,000
• Purchases: $200,000
• Ending Inventory: $100,000
• Cost of Goods Sold: $180,000

Requirements:

1. Confirm the Cost of Goods Sold using the Inventory formula.
2. Calculate the Inventory Turnover Ratio.
3. Determine the Days Sales of Inventory (DSI).
4. Analyze if the company is managing its inventory efficiently.