Question

E Business Course Return to course Question 3 Not complete Marked out of 12.00 P Flag question Inventory Management Metrics Large retailers like Costco and Target typically use gross margin ratio (gross margin + sales), invento on investment (GMROI) to evaluate how well inventory has been managed. The goal is to maximize scenarios, a base scenario (A) followed by three modifications (B, C, and D) to the base scenario. Scenario A Scenario B Scenario C Scenario D Sales $50,000 $ 75,000 $ 60,000 $ 50,000 Cost of goods sold 35,000 35,000 30,000 35,000 Gross profit $ 15,000 $ 40,000 $ 30,000 $ 15,000 Average inventory $ 6,000 $ 6,000 $6,000 $4,000 For each scenario calculate the gross margin percent, the inventory turnover, and GMROI. Round your answers to one decimal place. (Example for % answers -- 99.9%) Scenario A Scenario B Scenario C Scenario D Gross Margin % 96 96 Inventory Turnover GMROI 96 96 96 96 96 96 Check

Answer 1

Gross Margin % (Gross Profit / Sales *100) Inventory Turnover (COGS / Average Inventory) GMROI (Gross Profit/ Average Inventory) Scenario A Scenario B Scenario C Scenario D 30.0% 53.3% 50.0% 30.0% 5.8 5.8 5.0 8.8 250.0% 666.7% 500.0% 375.0%

Note: Generally GMROI is also calculated in Times but because you shown in format that you require that in percentage i calculated the same in percentage.

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