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The following accounting information pertains to two grocery store chains. One grocery store chain has a market strategy of selling only high end organic food products while the other grocery store sells less expensive foods that are traditionally grown with the use of pesticides, synthetic fertilizers, and/or genetically modified organisms. The company selling traditional produced foods has an average inventory balance of $45,000, while the company selling organic foods has an average inventory balance of $40,000. Problem a. Complete the table by filling in the missing amounts.
Problem b. Which grocery store chain is taking a lower cost/higher volume strategy as it relates to sales?
Problem c1. Calculate the inventory turnover and average days to sell inventory for each grocery store chain.
Problem c2. Based on your calculations, which grocery chain will be required to reorder inventory more frequently?
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