Question

Solve for the missing information designated by “?” in the following table.

(Use 365 days in a year. Round the inventory turnover ratio to one decimal place before computing days to sell. Round days to sell to one decimal place.)

BI Inventory Days to Sell Turnover Ratio Purchases $ 700 ways sen Case a b. $ $ $ 100 200 CGSEL 6001 1,2007 1,000 $ 6.0 $ 150 36.5

Answer 1

Answer

Case	BI	Purchases	CGS	EI	Inventory Turnover Ratio	Days to sell
a	$                           100.00	$                        700.00	$                        600.00	$                                            200.00	4.0	91.3
b	$                           200.00	$                    1,000.00	$                    1,200.00	$                                            200.00	6.0	60.8
c	$                              50.00	$                        950.00	$                    1,000.00	$                                            150.00	10.0	36.5

--Working

Equation used:

BI + Purchases - CGS = EI

Inventory turnover = CGS / [(BI + EI)/2]

Days to sell = 365 / Inventory Turnover

Case	BI	Purchases	CGS	EI	Inventory Turnover Ratio	Days to sell
a	100	700	600	=100+700-600	=600/((100+200)/2)	91.25
b	200	=1200-200	1200	=+((200)*2)-200	6	60.8333333333333
c	=+((100)*2)-150	=1000-50	1000	150	=365/(36.5)	36.5