Determine the inventory turnover for 20y7 and 20y6

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Reference no: EM133378718

Question: Inventory turnover and number of days' sales in inventory

Financial statement data for years ending December 31 for Tango Company follow:

	20Y7	20Y6
Cost of goods sold	$3,864,000	$4,001,500
Inventories:
Beginning of year	770,000	740,000
End of year	840,000	770,000

Required

a. Determine the inventory turnover for 20Y7 and 20Y6. Round to one decimal place.

20Y7	20Y6
Inventory turnover	fill in the blank 1	fill in the blank 2

b. Determine the number of days' sales in inventory for 20Y7 and 20Y6. Use 365 days and round to one decimal place.

20Y7	20Y6
Number of days' sales in inventory	fill in the blank 3 days	fill in the blank 4 days

c. Are the changes in inventory turnover and the number of days' sales in inventory from 20Y6 to 20Y7 favorable or unfavorable?

Reference no: EM133378718

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