V2.cengagehðw.comPrint ItemCalculatorShow Me HoweBookCntry AnalySisThe following data were extracted from the income statement of Keever Inc.:Previous YearCurrent Year$18,500,000$20,000,000Sales940,000Beginning inventories860,000Cost of goods sold9,270,00010,800,000Ending inventories1,120,000940,000a. Determine for each year (1) the inventory turnover and (2) the number of days' sales in inventory. Round interim calculations to the nearestdollar and final answers to one decimal place. Assume 365 days a year.Current YearPrevious Year1. Inventory turnover2. Number of days' sales in inventorydaysdaysb. The inventory position of the business has deterioratedThe inventory turnover has decreasedwhile the number of days' sales ininventory has increasedThe sales volume has declinedfaster than the inventory, resulting in a deterioratinginventoryposition.FeedbackCheck My Worka.1. Divide the cost of goods sold by the average inventory. Average inventory (Beginning inventory+ Ending inventory) + 2.a.2. Divide the average inventory by the average daily cost of goods sold. Average inventoryof aoods sold = cost of goods + 365 davs.(Beginning inventory + Ending inventory) + 2. Average daily costCheck My WorkPreviousNextAll work saved.Save and ExitSubmit Assignment for GradingJUL13P

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Asked Jul 14, 2019
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Cntry AnalySis
The following data were extracted from the income statement of Keever Inc.:
Previous Year
Current Year
$18,500,000
$20,000,000
Sales
940,000
Beginning inventories
860,000
Cost of goods sold
9,270,000
10,800,000
Ending inventories
1,120,000
940,000
a. Determine for each year (1) the inventory turnover and (2) the number of days' sales in inventory. Round interim calculations to the nearest
dollar and final answers to one decimal place. Assume 365 days a year.
Current Year
Previous Year
1. Inventory turnover
2. Number of days' sales in inventory
days
days
b. The inventory position of the business has deteriorated
The inventory turnover has decreased
while the number of days' sales in
inventory has increased
The sales volume has declined
faster than the inventory, resulting in a deteriorating
inventory
position.
Feedback
Check My Work
a.1. Divide the cost of goods sold by the average inventory. Average inventory (Beginning inventory+ Ending inventory) + 2.
a.2. Divide the average inventory by the average daily cost of goods sold. Average inventory
of aoods sold = cost of goods + 365 davs.
(Beginning inventory + Ending inventory) + 2. Average daily cost
Check My Work
Previous
Next
All work saved.
Save and Exit
Submit Assignment for Grading
JUL
13
P
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V2.cengagehðw.com Print Item Calculator Show Me How eBook Cntry AnalySis The following data were extracted from the income statement of Keever Inc.: Previous Year Current Year $18,500,000 $20,000,000 Sales 940,000 Beginning inventories 860,000 Cost of goods sold 9,270,000 10,800,000 Ending inventories 1,120,000 940,000 a. Determine for each year (1) the inventory turnover and (2) the number of days' sales in inventory. Round interim calculations to the nearest dollar and final answers to one decimal place. Assume 365 days a year. Current Year Previous Year 1. Inventory turnover 2. Number of days' sales in inventory days days b. The inventory position of the business has deteriorated The inventory turnover has decreased while the number of days' sales in inventory has increased The sales volume has declined faster than the inventory, resulting in a deteriorating inventory position. Feedback Check My Work a.1. Divide the cost of goods sold by the average inventory. Average inventory (Beginning inventory+ Ending inventory) + 2. a.2. Divide the average inventory by the average daily cost of goods sold. Average inventory of aoods sold = cost of goods + 365 davs. (Beginning inventory + Ending inventory) + 2. Average daily cost Check My Work Previous Next All work saved. Save and Exit Submit Assignment for Grading JUL 13 P

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Expert Answer

Step 1

Formula for Inventory turnover:

Inventory turnover = Cost of goods sold / Average inventory

Step 2

Calculate inventory turno...

Current Year
$9,270,000
$1,030,000(($940,000+ $1,120,000)/2)|
Particulars
Workings
Previous Year
Workings
Cost of goods sold
Average inventory
Inventory turnover
$10,800,000
$900,000 (($860,000 + $940,000)/2)
12
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Current Year $9,270,000 $1,030,000(($940,000+ $1,120,000)/2)| Particulars Workings Previous Year Workings Cost of goods sold Average inventory Inventory turnover $10,800,000 $900,000 (($860,000 + $940,000)/2) 12

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