Cost of goods sold = $6,000,000
Average inventory = (Beginning inventory+ Ending inventory)/2
= (910,000+1,500,000)/2
= $1,205,000
Inventory turnover ratio = Cost of goods sold/ Average inventory
= 6,000,000/1,205,000
= 4.98 times
Net sales = 10,000,000
Average accounts receivable = (Beginning accounts receivable+ Ending accounts receivable)/2
= (620,000+940,000)/2
= $780,000
Receivable turnover ratio = Net sales/ Average accounts receivable
= 10,000,000/780,000
= $12.82 times
Average collection period = 365/Receivable turnover ratio
= 365/12.82
= 28.47 days
Average total assets = ( Beginning total assets+ Ending total assets)/2
= (5,470,000+6,580,000)/2
= $6,025,000
Average turnover ratio = Net sales/ Average total assets
= 10,000,000/6,025,000
= 1.66 times
Inventory turnover ratio | 4.98 | times |
Receivable turnover ratio | 12.82 | times |
Average collection period | 28.47 | days |
Asset turnover ratio | 1.66 | times |
Kindly comment if you need further assistance. Thanks‼!
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