TABLE 12.3 SAPPHIRE AEROSPACE INVENTORY ITEMS Category Part Number Average Inventory Units Value per Unit Raw materials RM-1 20,000 $1 RM-2 5,000 RM-3 3,000 6 RM-4 1,000 8 Work-in-process WIP-1 6,000 10 WIP-2 8,000 12 Finished goods FG-1 1,000 65 FG-2 500 88
TABLE 12.3 SAPPHIRE AEROSPACE INVENTORY ITEMS Category Part Number Average Inventory Units Value per Unit Raw materials RM-1 20,000 $1 RM-2 5,000 RM-3 3,000 6 RM-4 1,000 8 Work-in-process WIP-1 6,000 10 WIP-2 8,000 12 Finished goods FG-1 1,000 65 FG-2 500 88
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question
Sapphire Aerospace operates 52 weeks per year, and its cost
of goods sold last year was $6,500,000. The firm carries eight
items in inventory: four raw materials, two work-in-process
items, and two finished goods. Table 12.3 shows last year’s
average inventory levels for these items, along with their unit
values.
a. What is the average aggregate inventory value?
b. How many weeks of supply does the firm have?
c. What was the inventory turnover last year?
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