Concept explainers
Inventory turnover ratio: This is a financial measure that is used to evaluate as to how many times a company sells or uses its inventory during an accounting period. It can be calculated by using the following formula:
Days’ sales in inventory: Days’ sales in inventory are used to determine number of days a particular company takes to make sales of the inventory available with them.
Gross Profit Percentage: It is the financial ratio that shows the relationship between the gross profit and net sales. It represents gross profit as a percentage of net sales. Gross Profit is the difference between the total revenue and the cost of goods sold. It can be calculated by using the following formula:
Note:
To Calculate: The inventory turnover for 2017, 2018, and 2019 of Corporation P.
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Financial Accounting, 10e WileyPLUS Registration Card + Loose-leaf Print Companion
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