The following is information for Palmer Company. Cost of goods sold Ending inventory Year 3 $ 643,825 Year 2 $ 426,650 Year 1 96,400 86,750 $ 391,300 91,500 Use the above information to compute inventory turnover for Year 3 and Year 2, and its days' sales in inventory at December 31, Year 3 and Year 2. From Year 2 to Year 3, did Palmer improve its (a) inventory turnover and (b) days' sales in inventory? Use the above information to compute inventory turnover for Year 2, and its days' sales in inventory at December 31, Year 2. Inventory turnover Numerator 1 Denominator Ratio Days' sales in inventory Use the above information to compute inventory turnover for Year 3, and its days' sales in inventory at December 31, Year 3. Numerator / Denominator Ratio Inventory turnover Days' sales in inventory Did Palmer improve its (a) inventory turnover from Year 2 to Year 3 and (b) days' sales in inventory from Year 2 to Year 3? (a) Did Palmer improve its inventory turnover from Year 2 to Year 3? (b) Did Palmer improve its days' sales in inventory from Year 2 to Year 3?

Century 21 Accounting General Journal
11th Edition
ISBN:9781337680059
Author:Gilbertson
Publisher:Gilbertson
Chapter20: Accounting For Inventory
Section: Chapter Questions
Problem 3AP
icon
Related questions
Topic Video
Question

sa

The following is information for Palmer Company.
Cost of goods sold
Ending inventory
Year 3
$ 643,825
96,400
Year 2
$ 426,650
86,750
Year 1
$ 391,300
91,500
Use the above information to compute inventory turnover for Year 3 and Year 2, and its days' sales in inventory at December 31, Year 3
and Year 2. From Year 2 to Year 3, did Palmer improve its (a) inventory turnover and (b) days' sales in inventory?
Use the above information to compute inventory turnover for Year 2, and its days' sales in inventory at December 31, Year 2.
Inventory turnover
Days' sales in inventory
Numerator
I
Denominator
=
Ratio
Use the above information to compute inventory turnover for Year 3, and its days' sales in inventory at December 31, Year 3.
Inventory turnover
Days' sales in inventory
Numerator
I
Denominator
=
Ratio
Did Palmer improve its (a) inventory turnover from Year 2 to Year 3 and (b) days' sales in inventory from Year 2 to Year 3?
(a) Did Palmer improve its inventory turnover from Year 2 to Year 3?
(b) Did Palmer improve its days' sales in inventory from Year 2 to Year 3?
Transcribed Image Text:The following is information for Palmer Company. Cost of goods sold Ending inventory Year 3 $ 643,825 96,400 Year 2 $ 426,650 86,750 Year 1 $ 391,300 91,500 Use the above information to compute inventory turnover for Year 3 and Year 2, and its days' sales in inventory at December 31, Year 3 and Year 2. From Year 2 to Year 3, did Palmer improve its (a) inventory turnover and (b) days' sales in inventory? Use the above information to compute inventory turnover for Year 2, and its days' sales in inventory at December 31, Year 2. Inventory turnover Days' sales in inventory Numerator I Denominator = Ratio Use the above information to compute inventory turnover for Year 3, and its days' sales in inventory at December 31, Year 3. Inventory turnover Days' sales in inventory Numerator I Denominator = Ratio Did Palmer improve its (a) inventory turnover from Year 2 to Year 3 and (b) days' sales in inventory from Year 2 to Year 3? (a) Did Palmer improve its inventory turnover from Year 2 to Year 3? (b) Did Palmer improve its days' sales in inventory from Year 2 to Year 3?
Expert Solution
steps

Step by step

Solved in 3 steps

Blurred answer
Knowledge Booster
Accounting for Merchandise Inventory
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.
Similar questions
Recommended textbooks for you
Century 21 Accounting General Journal
Century 21 Accounting General Journal
Accounting
ISBN:
9781337680059
Author:
Gilbertson
Publisher:
Cengage
Cornerstones of Financial Accounting
Cornerstones of Financial Accounting
Accounting
ISBN:
9781337690881
Author:
Jay Rich, Jeff Jones
Publisher:
Cengage Learning
Managerial Accounting: The Cornerstone of Busines…
Managerial Accounting: The Cornerstone of Busines…
Accounting
ISBN:
9781337115773
Author:
Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger
Publisher:
Cengage Learning
Financial Accounting
Financial Accounting
Accounting
ISBN:
9781337272124
Author:
Carl Warren, James M. Reeve, Jonathan Duchac
Publisher:
Cengage Learning
Survey of Accounting (Accounting I)
Survey of Accounting (Accounting I)
Accounting
ISBN:
9781305961883
Author:
Carl Warren
Publisher:
Cengage Learning
Principles of Accounting Volume 1
Principles of Accounting Volume 1
Accounting
ISBN:
9781947172685
Author:
OpenStax
Publisher:
OpenStax College