Early in 2014, Chien Company switched to a just-in-time inventory system. Its sales, cost of goods sold, and inventory amounts for 2013 and 2014 are shown below.
|
2013
|
2014
|
|
Sales
|
$3,120,000
|
$3,713,000
|
|
Cost of goods sold
|
1,200,000
|
1,425,000
|
|
Beginning nventody
|
180,000
|
220,000
|
|
Ending inventory
|
220,000
|
100,000
|
Determine the inventory turnover and days in inventory for 2013 and 2014. Discuss the changes in the amount of inventory, the inventory turnover and days in inventory, and the amount of sales across the two years.