There are advantages of companies and organizations that have worked hard to attain lower amounts of...
There are advantages of companies and organizations that have worked hard to attain lower amounts of inventory, high inventory turnover ratio and low amounts of weeks of supply. What economic advantages do companies have who enjoy attain these strengths? Discuss from a cost and an investment perspective.
Homework Answers
Yes, there is no doubt in the fact that many advantages are enjoyed by organizations who manage to attain these strengths, some of the advantages of cost and investment perspective are:
- Their fixed cost decreases which were earlier used to keep the inventory, hence they have to invest less as well on warehouses.
- The wastage also decreases which directly affects the cost very positively.
- A balance in demand and supply is maintained because of their ability to foresee the market conditions. It adds on to their profits.
- The saved amount can be invested in many other productive options for the company which can fetch them good revenue.
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Cost of sales
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Inventory
$1 comma 2901,290
Total assets
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question number 3 and type them and bold or underline the correct
answers
Baker Mfg Inc. wishes to compare its inventory turnover to those
of industry leaders, who have turnover of about
1313
times per year and
88 %
of their assets invested in inventory.
Baker Mfg. Inc.
Net Revenue
$27 comma 50027,500
Cost of sales
$19 comma 41019,410
Inventory
$1 comma 2901,290
Total assets
$17 comma 82017,820
a) What is Baker's inventory turnover?...
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