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ACC-502 Topic 3
Kevin Goffney
1. Calculate Inventory Turnover Ratio for Coca Cola
Name of Ratio:
Inventory Turnover
Ratio Formula is: Cost of Goods Sold/Average Inventory
Coca Cola Co.
2023
2022
Cost of Goods Sold
$18,500 $18,000 Average Inventory
$4,424 $4,433 Inventory Turnover
4.181736
4.060456
2. Calculate Average Days in Inventory
Name of Ratio: Average Days in Inventory
Ratio Forula is: 365 Days/Inventory Turnover
Coca Cola Co.
2023
2022
Number of Days
365
365
Inventory Turnover
4.181736
4.060456
Average Days in Inventory
87.284324
89.89138
References:
https://investors.coca-colacompany.com/filings-reports/annual-filings-10-k
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ACC-502 Topic 3
Kevin Goffney
1. Calculate Inventory Turnover Ratio for PepsiCo
Name of Ratio:
Inventory Turnover
Ratio Formula is: Cost of Goods Sold/Average Inventory
PepsiCo
2023
2022
Cost of Goods Sold
$41,881 $40,576 Average Inventory
$5,334 $5,222 Inventory Turnover
7.851706
7.770203
2. Calculate Average Days in Inventory for PepsiCo
Name of Ratio: Average Days in Inventory
Ratio Forula is: 365 Days/Inventory Turnover
PepsiCo
2023
2022
Number of Days
365
365
Inventory Turnover
7.85106
7.77203
Average Days in Inventory
46.49054
46.96328
References:
PepsiCo, Inc. (2024). Form 10-k annual report for the fiscal year ended December 30, 20
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Related Questions
1.6 The following information was extracted from the records of Boyle Stores for May 2020:
May
Units of
Cost price
per unit
inventory
Inventory on hand
4 000
01
R20
14
Purchases
20 000
R22
21
Purchases
16 000
R24
31
Sales for May 2020
22 000
The value of inventory on 31 May 2020, using the First-In-First-Out (FIFO) method is
A R432 000
B R388 000
C R428 000
D R360 00
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1.1
REQUIRED
Use the information provided below to prepare an extract of the statement of comprehensive income that
includes the value of closing inventory as at 31 December 2022 and gross profit for the year ended December
2022 using the following methods of inventory valuation:
1.1.1 FIFO
1.1.2 Weighted average cost
INFORMATION
GH Suppliers had an inventory of 10 wallets at R50 each on 01 January 2022, the start of the financial year.
During 2022 the following purchases and return were recorded:
75 wallets at R60 each were purchased on 20 February 2022.
25 wallets at R80 each were purchased on 25 August 2022.
10 wallets that were purchased on 25 August 2022 were returned to the supplier.
During 2022, 50 wallets were sold at R80 each and 30 wallets were sold at R100 each.
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1.1
REQUIRED
Use the information provided below to prepare an extract of the statement of comprehensive income that
includes the value of closing inventory as at 31 December 2022 and gross profit for the year ended December
2022 using the following methods of inventory valuation:
1.1.1 FIFO
1.1.2 Weighted average cost
INFORMATION
GH Suppliers had an inventory of 10 wallets at R50 each on 01 January 2022, the start of the financial year.
During 2022 the following purchases and return were recorded:
75 wallets at R60 each were purchased on 20 February 2022.
25 wallets at R80 each were purchased on 25 August 2022.
10 wallets that were purchased on 25 August 2022 were returned to the supplier.
During 2022, 50 wallets were sold at R80 each and 30 wallets were sold at R100 each.
1.2
REQUIRED
Calculate the economic order quantity (EOQ) from the information provided below.
INFORMATION
The monthly demand for an item sold by Super Stores is 1 000 units. The cost is R6 per unit and the item is…
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Question Content Area
Based on the following data for the current year, what is the inventory turnover?
Sales on account during year
$507,225
Cost of goods sold during year
190,106
Accounts receivable, beginning of year
47,004
Accounts receivable, end of year
51,339
Inventory, beginning of year
36,189
Inventory, end of year
44,233
Do not round interim calculations. Round your final answer to one decimal place.
a.1.2
b.28.9
c.4.7
d.2.7
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Cost of goods sold
Average inventory
2020
2021
2022
$923,550 $980,640
126,290
Inventory Turnover
7.3
2021
6.3
5.3
156,510
2022
(a) Do a trend analysis of the inventory turnover for each year. Also calculate the days to sell invento
(Round inventory turnover to 2 decimal places, e.g. 18.42 and number of days to 1 decimal place, e.g. 13.6.,
$1,149,910 $1,329,510
208,410
Number of Days
2023
321,820
days
days
days
2024
$1,408,530
451,860
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1
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Current Attempt in Progress
The cost of goods sold computations for Flint Company and Pina Colada Company are shown below.
Beginning inventory
Cost of goods purchased
Cost of goods available for sale
Ending inventory
Cost of goods sold
(a1)
Inventory turnover
eTextbook and Media
norcal archives 20....zip
Flint Company
^
$ 46,000
197,500
W
243,500
55,000
$188,500
Compute inventory turnover for each company. (Round answers to 2 decimal places, e.g. 15.25.)
Flint Company
Pina Colada Company
$72,500
OCA 5.docx
294,000
366,500
73,000
$293,500
Pina Colada Company
W
response essay.docx
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=6
Billingsly Products uses the conventional retail method to estimate its ending inventories. The following data has been summarized for
the year 2024:
Inventory, January 1
Purchases
Net markups
Net markdowns
Net sales
Cost
$ 53,000
322,360
Retail
$ 78,000
466,000
8,000
16,700
392,000
Required:
Estimate the ending inventory as of December 31, 2024.
Estimated ending inventory at retail
Estimated ending inventory at cost
K
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A v2.cengagenow.com
Perpetual Inventory Using Weighted Average
Beginning inventory, purchases, and sales for WCS12 are as follows:
Oct. 1
Inventory
350 units at $10
13
Sale
160 units
22
Purchase
310 units at $13
29
Sale
300 units
a. Assuming a perpetual inventory system and using the weighted average method, determine the weighted
average unit cost after the October 22 purchase. Round your answer to two decimal places.
per unit
b. Assuming a perpetual inventory system and using the weighted average method, determine the cost of
goods sold on October 29. Round your "average unit cost" to two decimal places.
c. Assuming a perpetual inventory system and using the weighted average method, determine the inventory
on October 31. Round your "average unit cost" to two decimal places.
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Question 1
Comvita follows the period inventory accounting. During the reporting period ended 31st December 2018, Comvita have sold 250, 000 units of Manuka honey with a sales price of $100.
Analyse how inventory valuation methods impact on financial statement analysis of Comvita. The Comvita management has asked you to recommend from three inventory valuation methodse. FIFO, LIFO and weighted average for their cost of goods sold. The management have provided you with the following data,-(LO2)
Inventory at 1 Jan 2018 is 90,000 units @ $ 50
Inventory at 30 March 2018 is 110,000 units @ 52
Inventory at 1st July 2018 is 55,000 units @ 60
Inventory at 1st October is 65,000 @ 70
(LO2. Apply accounting tools and techniques to analyse and resolve complex situations within an organisation).
Note: Your recommendation should be supported with the evaluation of cost of goods sold calculation for each inventory methods .
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DATE
DETAILS
UNITS
COST PER UNIT
1
OPENING INVENTORY
20
R85
7
Purchases
23
R90
16
Purchases
33
R95
25
Purchases
18
R100
31
Sales for the month
69
Calculate the value of closing inventory using the Weighted average cost inventory valuationmethod.
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Part 2
The Kroger Company
Net sales
Cost of sales (using LIFO)
Year-end inventories using FIFO
Year-end inventories using LIFO
Required: Compute the following:
LIFO reserve is
Kroger uses the LIFO inventory method and sales and cost of sales are reported
above using LIFO.
Gross margin in dollars (LIFO)
Gross margin in dollars (FIFO)
LIFO Inventory turnover*
FIFO Inventory turnover*
January 31, 2015
108,465.00
Definitions
*Inventory turnover ratio=
Gross margin in dollars =
85,512
6,933
5,688
February 1, 2014 February 2, 2013
98,375.00
96,619.00
78,138
76,726
6,801
6,244
5,651
5,146
January 31, 2015 February 1, 2014 February 2, 2013
Cost of Sales/Year-end Inventory
Net Sales less cost of sales
85512
6933
5688
78138
6801
5651
76726
6244
5146
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Applying the Cost of Goods Sold Model
Charest Company has the following data for 2022:
Item
Units
Cost
Inventory, 12/31/2021
980
$10,780
Purchases
4,480
49,280
Inventory, 12/31/2022
750
8,250
Required:
1. How many units were sold?
2. Using the cost of goods sold model, determine the cost of goods sold.
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Current Attempt in Progress
The following data were taken from the financial records of Blossom Company.
Net sales
Beginning inventory
Purchases
Ending inventory
Inventory turnover
2022
$6,310,000
Days in inventory
970,000
4,994,500
eTextbook and Media
1,040,000
2021
$6,120,000
Compute for each year the inventory turnover. (Round answers to 1 decimal place, e.g. 1.6.)
2022
2022
910,000
4,948,000
970,000
times
Compute for each year the days in inventory. (Use 365 days for calculation. Round answers to 1 decimal place, e.g. 1.6.)
2021
days
times
2021
days
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Exercise 2:
Presented below is information related to Drake Company.
Ending Inventory (Yearend Prices)
$80,000
115,500
108,000
December 31, 2025
122,200
December 31, 2026
154,000
December 31, 2027
176,900
Compute the ending inventory for Drake Company for 2022 through 2027 using the dollar-value LIFO method.
Date
December 31, 2022
December 31, 2023
December 31, 2024
Price Index
100
105
120
130
140
145
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Question 1 Inventory 1. A. Raytheon inventory information is as follows: o Beginning inventory (1/1/19): 200 units @ $1.00 o Purchase of inventory (1/14/19): 400 units @ $4.00 o Sale of inventory: 1/15/19: 300 units 1/16/19: 250 units o Total Sales Revenue = $2,250 Q1. Using the information above, compute COGS, Ending Inventory and Gross Profit under FIFO, LIFO, and Weighted average:
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Use the following information for Shafer Company to compute inventory turnover for year 2.
Year 2
Year 1
Net sales
$657,500 $584,900
Cost of goods sold
Ending inventory
390,500
361,040
79,700
81,380
Multiple Choice
4.00
4.85
8.25
5.85
7.19
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- 1.6 The following information was extracted from the records of Boyle Stores for May 2020: May Units of Cost price per unit inventory Inventory on hand 4 000 01 R20 14 Purchases 20 000 R22 21 Purchases 16 000 R24 31 Sales for May 2020 22 000 The value of inventory on 31 May 2020, using the First-In-First-Out (FIFO) method is A R432 000 B R388 000 C R428 000 D R360 00arrow_forward1.1 REQUIRED Use the information provided below to prepare an extract of the statement of comprehensive income that includes the value of closing inventory as at 31 December 2022 and gross profit for the year ended December 2022 using the following methods of inventory valuation: 1.1.1 FIFO 1.1.2 Weighted average cost INFORMATION GH Suppliers had an inventory of 10 wallets at R50 each on 01 January 2022, the start of the financial year. During 2022 the following purchases and return were recorded: 75 wallets at R60 each were purchased on 20 February 2022. 25 wallets at R80 each were purchased on 25 August 2022. 10 wallets that were purchased on 25 August 2022 were returned to the supplier. During 2022, 50 wallets were sold at R80 each and 30 wallets were sold at R100 each.arrow_forward1.1 REQUIRED Use the information provided below to prepare an extract of the statement of comprehensive income that includes the value of closing inventory as at 31 December 2022 and gross profit for the year ended December 2022 using the following methods of inventory valuation: 1.1.1 FIFO 1.1.2 Weighted average cost INFORMATION GH Suppliers had an inventory of 10 wallets at R50 each on 01 January 2022, the start of the financial year. During 2022 the following purchases and return were recorded: 75 wallets at R60 each were purchased on 20 February 2022. 25 wallets at R80 each were purchased on 25 August 2022. 10 wallets that were purchased on 25 August 2022 were returned to the supplier. During 2022, 50 wallets were sold at R80 each and 30 wallets were sold at R100 each. 1.2 REQUIRED Calculate the economic order quantity (EOQ) from the information provided below. INFORMATION The monthly demand for an item sold by Super Stores is 1 000 units. The cost is R6 per unit and the item is…arrow_forward
- Question Content Area Based on the following data for the current year, what is the inventory turnover? Sales on account during year $507,225 Cost of goods sold during year 190,106 Accounts receivable, beginning of year 47,004 Accounts receivable, end of year 51,339 Inventory, beginning of year 36,189 Inventory, end of year 44,233 Do not round interim calculations. Round your final answer to one decimal place. a.1.2 b.28.9 c.4.7 d.2.7arrow_forwardCost of goods sold Average inventory 2020 2021 2022 $923,550 $980,640 126,290 Inventory Turnover 7.3 2021 6.3 5.3 156,510 2022 (a) Do a trend analysis of the inventory turnover for each year. Also calculate the days to sell invento (Round inventory turnover to 2 decimal places, e.g. 18.42 and number of days to 1 decimal place, e.g. 13.6., $1,149,910 $1,329,510 208,410 Number of Days 2023 321,820 days days days 2024 $1,408,530 451,860arrow_forward1 View Policies Current Attempt in Progress The cost of goods sold computations for Flint Company and Pina Colada Company are shown below. Beginning inventory Cost of goods purchased Cost of goods available for sale Ending inventory Cost of goods sold (a1) Inventory turnover eTextbook and Media norcal archives 20....zip Flint Company ^ $ 46,000 197,500 W 243,500 55,000 $188,500 Compute inventory turnover for each company. (Round answers to 2 decimal places, e.g. 15.25.) Flint Company Pina Colada Company $72,500 OCA 5.docx 294,000 366,500 73,000 $293,500 Pina Colada Company W response essay.docxarrow_forward
- =6 Billingsly Products uses the conventional retail method to estimate its ending inventories. The following data has been summarized for the year 2024: Inventory, January 1 Purchases Net markups Net markdowns Net sales Cost $ 53,000 322,360 Retail $ 78,000 466,000 8,000 16,700 392,000 Required: Estimate the ending inventory as of December 31, 2024. Estimated ending inventory at retail Estimated ending inventory at cost Karrow_forwardA v2.cengagenow.com Perpetual Inventory Using Weighted Average Beginning inventory, purchases, and sales for WCS12 are as follows: Oct. 1 Inventory 350 units at $10 13 Sale 160 units 22 Purchase 310 units at $13 29 Sale 300 units a. Assuming a perpetual inventory system and using the weighted average method, determine the weighted average unit cost after the October 22 purchase. Round your answer to two decimal places. per unit b. Assuming a perpetual inventory system and using the weighted average method, determine the cost of goods sold on October 29. Round your "average unit cost" to two decimal places. c. Assuming a perpetual inventory system and using the weighted average method, determine the inventory on October 31. Round your "average unit cost" to two decimal places. Previous Next Check My Work All work saved. Save and Exit Submit Assignment for Grading %24arrow_forwardQuestion 1 Comvita follows the period inventory accounting. During the reporting period ended 31st December 2018, Comvita have sold 250, 000 units of Manuka honey with a sales price of $100. Analyse how inventory valuation methods impact on financial statement analysis of Comvita. The Comvita management has asked you to recommend from three inventory valuation methodse. FIFO, LIFO and weighted average for their cost of goods sold. The management have provided you with the following data,-(LO2) Inventory at 1 Jan 2018 is 90,000 units @ $ 50 Inventory at 30 March 2018 is 110,000 units @ 52 Inventory at 1st July 2018 is 55,000 units @ 60 Inventory at 1st October is 65,000 @ 70 (LO2. Apply accounting tools and techniques to analyse and resolve complex situations within an organisation). Note: Your recommendation should be supported with the evaluation of cost of goods sold calculation for each inventory methods .arrow_forward
- DATE DETAILS UNITS COST PER UNIT 1 OPENING INVENTORY 20 R85 7 Purchases 23 R90 16 Purchases 33 R95 25 Purchases 18 R100 31 Sales for the month 69 Calculate the value of closing inventory using the Weighted average cost inventory valuationmethod.arrow_forwardPart 2 The Kroger Company Net sales Cost of sales (using LIFO) Year-end inventories using FIFO Year-end inventories using LIFO Required: Compute the following: LIFO reserve is Kroger uses the LIFO inventory method and sales and cost of sales are reported above using LIFO. Gross margin in dollars (LIFO) Gross margin in dollars (FIFO) LIFO Inventory turnover* FIFO Inventory turnover* January 31, 2015 108,465.00 Definitions *Inventory turnover ratio= Gross margin in dollars = 85,512 6,933 5,688 February 1, 2014 February 2, 2013 98,375.00 96,619.00 78,138 76,726 6,801 6,244 5,651 5,146 January 31, 2015 February 1, 2014 February 2, 2013 Cost of Sales/Year-end Inventory Net Sales less cost of sales 85512 6933 5688 78138 6801 5651 76726 6244 5146arrow_forwardApplying the Cost of Goods Sold Model Charest Company has the following data for 2022: Item Units Cost Inventory, 12/31/2021 980 $10,780 Purchases 4,480 49,280 Inventory, 12/31/2022 750 8,250 Required: 1. How many units were sold? 2. Using the cost of goods sold model, determine the cost of goods sold.arrow_forward
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