Question
The following information is available for MVF Company (dollar amounts are in millions): 2016 2015 2014 2013 Net sales $23.2 $21.7 $19.6 $17.4 Cost of
The following information is available for MVF Company (dollar amounts are in millions):
| 2016 | 2015 | 2014 | 2013 |
Net sales | $23.2 | $21.7 | $19.6 | $17.4 |
Cost of goods sold | 17.1 | 16.8 | 15.2 | 13.5 |
Beginning finished goods inventory | 2.3 | 2.1 | 1.9 | 1.5 |
Ending finished goods inventory | 2.9 | 2.3 | 2.1 | 1.9 |
Materials purchased | 10.6 | 8.8 | 7.5 | 7.1 |
a. Calculate the following ratios for each year:
Gross profit percentage.
Inventory turnover.
Cost of materials purchased to cost of finished goods produced.
b. Analyze the results obtained in 3.a. above:
Describe the change in each ratio you observe in 2016.
Discuss at least two possible causes of each change observed.
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