Question - The following financial statement data for years ending December 31 for Holland Company are shown below.
|
|
20Y4
|
20Y3
|
|
Cost of materials sold
|
$1,007,400
|
$640,794
|
|
Inventories:
|
|
|
|
Beginning of the year
|
$179,580
|
$125,560
|
|
End of year
|
258,420
|
179,580
|
a. Determine the inventory turnover for 20Y4 and 20Y3.
b. Determine the days' sales in inventory for 20Y4 and 20Y3. Assume 365 days a year.
c. Does the change In Inventory turnover and the days' sales In Inventory from 20Y3 to 20Y4 indicate a favorable or an unfavorable trend?