Problem

A company's inventory turnover rate is one measure of its potential to convert invento...

A company's inventory turnover rate is one measure of its potential to convert inventory into cash. But what is considered a good inventory turnover rate? The answer to that question depends on a variety of industry and company characteristics.

Access the EDGAR database at the following Internet address:

Locate the most recent 10-K reports of Safeway, Inc., and Staples, Inc. Compute the inventory turnover rates of each company. Does the higher turnover rate computed for Safeway mean that the company manages its inventory more effectively than Staples? Explain.

Internet sites are time and date sensitive. It is the purpose of these exercises to have you explore the Internet. You may need to use the Yahoo! search engine http://www.yahoo.com (or another favorite search engine) to find a company̕ s, current Web address.

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