An analyst observes a decrease in a company’s inventory turnover. Which of the following would most likely explain this trend? B . Due to problems with obsolescent inventory last year, the company wrote off a large amount of its inventory at the beginning of the period.

Q: Data on Shin Inc. for 2008 are shown below, along with the inventory conversion period (ICP) of the…

A: Every business wants to decrease its inventory conversion period so that their business turn into…

Q: Hubble Space Incorporated has the following data which includes inventory conversion period or ICP…

A: Inventory conversion period is the number of days required to convert raw materials into finished…

Q: Zimt AG wrote down the value of its inventory in 2007 and reversed the write-down in2008. Compared…

A: Since the surplus inventory does not compensate enough for the cost of the product available to the…

Q: You are making a detailed analysis of the financial statements and accounting records of two…

A: Different companies value their inventories differently depending on the type of inventory,…

Q: When analyzing financial statements, what can you conclude when the inventory turnover ratio…

A: While analyzing the financial statements, we observe that the inventory turnover ratio increases…

Q: Which of the following would best explain an decrease in the company's inventory turnover? A. Due…

A: An inventory turnover is defined as the financial ratio, which used to represent how many times the…

Q: Errors were made in each year as follows: in 2020, ending inventory was overstated by $10,600 while…

A: The impact of errors of overstated ending inventory for 2021 profit and owner's equity is shown…

Q: A firm with sales of $500,000 has average inventory of $200,000. the industry average for inventory…

A: Inventory turnover measures how many times, on average company sells its entire inventory during the…

Q: Astro company changed its inventory cost flow assumption from FIFO to LIFO in a period of rising…

A: The question is based on the concept of Cost accounting

Q: HAKDOG Company suspects that there is missing inventory in its warehouse at December 31, 2021. All…

A: Net purchases are determined by deducting the purchase allowances, discount and returns from gross…

Q: The following data were extracted from the income statement of Shriver Inc.: Current Year Prior Year…

A: DIO( Days Inventory Outstanding)=(Avg Inventory/COGS)*No of days

Q: Wilma Company experienced a P500,000 decline in the market value of inventory at the end of the…

A: ANSWER The correct option is d.) first quarter 0 , Second quarter 0 EXPLANATION Interim periods are…

Q: 7. Charles Inc. has an ending inventory of $423,425, and the cost of goods sold for the year just…

A: Solution:- Inventory Turnover ratio computes the pace at which the inventory is being used.

Q: Marshall Tool and Die Company has been experiencing significant foreign competition and a declining…

A: Balance Sheet is a financial statement which shows the financial position of the company. It helps…

Q: After years of steady growth in net income, Performance Drug Company reported a preliminary net loss…

A: Since we only answer up to 3 sub-parts, we’ll answer the first 3. Please resubmit the question and…

Q: The following data were extracted from the income statement of Keever Inc.:   Current Year Previous…

A: The inventory turnover ratio helps to analyze the efficiency of the business to convert its…

Q: Indicate by a (1), (2), or (0) whether each of the following events wouldprobably cause average…

A: Lessening the inventory since with conveyance through air will impact in the lead time would…

Q: Inventory turnover indicates Group of answer choices the pattern of transferring units costs from…

A: Ratio analysis is one of the important tool used in management accounting. Efficiency ratios is one…

Q: Farley Bains, an auditor with Nolls CPAs, is performing a review of Waterway Company’s Inventory…

A: Prepare a schedule to determine the correct inventory amount as shown below:

Q: A manufacturer reported an inventory turnover ratio of 8.6 last year. During the current year,…

A:

Q: Rachel Warren, an auditor with Laplante CPAS, is performing a review of Pina Colada Corp.'s…

A: No. Ending Inventory - As reported Reason 1. Included in the company’s count were goods with…

Q: e ratio was always lower. Which of the following statements would be the best interpretation for the…

A: Inventory turnover ratio establishes the relationship between the cost of goods sold and the average…

Q: Substantive test of auditing inventory 1. Analytical procedure Make comparison between current…

A: "Since you have asked multiple question we will solve the first question for you.  If you want any…

Q: Parker Company had $5,000,000 in sales and reported a $300,000 loss in its annual report to…

A: Break even point is the number of sales where all the Expenses variable and fixed get covered and no…

Q: Zimt AG wrote down the value of its inventory in 2007 and reversed the write-downin 2008. Compared…

A: The correct option is Option C. Inventory turnover was too high.

Q: Astro Company changed its inventory cost flow assumption from FIFO to LIFO in a period of rising…

A: 1. If a company uses the FIFO method and the prices are rising over a period then it means the Cost…

Q: A company's gross profit as a percentage of sales increased from 24% in the year ended 31 December…

A: The gross profit ratio represents the portion of sales considered to be the earnings for the…

Q: Contrast the effects that LIFO vs. FIFO would have on ending inventory, net income and cash flow in…

A: Inventory Valuation There are many methods which are used to measure the inventory valuation in the…

Q: What do you think will happen to the financial performance of the company if at the end of the…

A: Having a lot of inventory in your warehouses usually signifies that your firm is struggling to…

Q: Bulldogs Inc. has recently calculated the inventory turnover for the currently year to be 30. In…

A: Answer. The company took fewer days to sell its inventory in the current year than in prior years.…

Q: The following data were taken from the income statements of MetronixCorporation. Compute the…

A: Calculation of inventory turn-over ratios for each year: Excel workings:

Q: - An analyst observes a decrease in a company's inventory turnover. Which of the following puld most…

A: Solution: Introduction: Inventory turnover ratio measures how well the company's effectiveness in…

Q: Indicate by a (1), (2), or (0) whether each of the following events wouldprobably cause average…

A: (1) It will annual inventory holdings to rise.

Q: Current Attempt in Progress         Sheridan Decor did not have a good year, and top management is…

A: Step 1 Adjusted inventory is the inventory which is reported taken effect after the adjustments…

Q: The analysis of Inventory Turnover Ratio is as follows: 2015: 4.34 2016: 3.15 2017: 4.76 2018: 2.94…

A: Meaning of Inventory Turnover - This ratio shows how quickly the inventory is being sold during a…

Q: If Soda Popinski's Company's ending inventory was actually $86,000 but was adjusted at year end to a…

A: Cost of good sold = Opening inventory + Purchases + Direct expenses - Closing inventory.   So,…

Q: Bulldogs Inc. has recently calculated the inventory turnover for the currently year to be 30. In…

A: Inventory turnover measures how many times in a given period a company is able to replace the…

Q: hat is the ratio that measures the number of days on average the company takes to turn its inventory…

A: Solution: Days inventory outstatnding represents the average number of days the inventory takes to…

Q: A large decrease in end of year grain inventory from one year to the next mistakenly left off of the…

A: Effect of decrease in Closing inventory on net income: Both the income statement and the balance…

Q: A company's gross profit as a percentage of sales increased from 24% in the year ended 31 December…

A: Solution: Introduction: Gross Profit is the income of a business earned after deducting its product…

Inventory Valuation

Before discussing the topic inventory valuation let’s discuss the meaning of inventory. In accounting, inventory is also known as stock. Inventory means all the finished goods, materials, merchandise that a business holds for the purpose of selling it in the market with the motive of earning profit.