Happy Valley Homecare Suppliers, Incorporated (HVHS), had $11.7 million in sales in 2015. Its cost of goods sold was $4.68 million, and its average inventory balance was $1.84 million. a. Calculate the average number of days inventory outstanding ratios for HVHS. b. The average number of inventory days in the industry is 73 days. By how much must HVHS reduce its investment in inventory to improve its inventory days to meet the industry? (Hint: Use a 365-day year.) a. Calculate the number of days inventory outstanding ratios for HVHS. The number of inventory days outstanding is days. (Round to two demical places.) b. The average number of inventory days in the industry is 73 days. By how much must HVHS reduce its investment in inventory to improve its inventory days to meet the industry? To match the industry average number of inventory days, HVHS would reduce its inventory by $ million. (Round to three decimal place.)

Happy Valley Homecare Suppliers, Incorporated (HVHS), had $11.7 million in sales in 2015. Its cost of goods sold was $4.68 million, and its average inventory balance was $1.84 million. a. Calculate the average number of days inventory outstanding ratios for HVHS. b. The average number of inventory days in the industry is 73 days. By how much must HVHS reduce its investment in inventory to improve its inventory days to meet the industry? (Hint: Use a 365-day year.) a. Calculate the number of days inventory outstanding ratios for HVHS. The number of inventory days outstanding is days. (Round to two demical places.) b. The average number of inventory days in the industry is 73 days. By how much must HVHS reduce its investment in inventory to improve its inventory days to meet the industry? To match the industry average number of inventory days, HVHS would reduce its inventory by $ million. (Round to three decimal place.)

Name: Happy Valley Homecare Suppliers, Incorporated (HVHS), had $11.7 milli
Uploaded: 2024-03-20T06:33:21.000Z
Channel: Bartleby
Description: Happy Valley Homecare Suppliers, Incorporated (HVHS), had $11.7 million in sales in 2015. Its cost of goods sold was $4.68 million, and its average inventory balance was $1.84 million.a. Calculate the average number of days inventory outstanding rat

Managerial Accounting: The Cornerstone of Business Decision-Making

7th Edition

ISBN:9781337115773

Author:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger

Publisher:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger

Chapter15: Financial Statement Analysis

Section: Chapter Questions

Problem 15BEA: Last year, Nikkola Company had net sales of 2,299,500,000 and cost of goods sold of 1,755,000,000....

See similar textbooks

Similar questions

Pedee Companys inventory turnover in days is 80 days. Which of the following actions could help to improve that ratio? a. Increase the sales price. b. Increase manufacturing costs. c. Reduce the cost of goods sold. d. Reduce average inventory. e. All of these.
A large manufacturer of truck and car tires recently changed its cost-flow assumption method for inventories at the beginning of 2014. The manufacturer has been in operation for almost 40 years, and for the last decade it has reported moderate growth in revenues. The firm changed from the LIFO method to the FIFO method and reported the following information (amounts in millions): REQUIRED Calculate the inventory turnover ratio for 2014 using the LIFO and FIFO cost-flow assumption methods. Explain why the costs assigned to inventory under LIFO at the end of 2013 and 2014 are so much less than they are under FIFO.
Use the following hypothetical data for Walgreens in Years 11 and 12 to project revenues, cost of goods sold, and inventory for Year +1. Assume that Walgreenss Year +1 revenue growth rate, gross profit margin, and inventory turnover will be identical to Year 12. Project the average inventory balance in Year +1 and use it to compute the implied ending inventory balance.
Happy Valley Homecare Suppliers, Incorporated (HVHS), had $13.6 million in sales in 2010. Its cost of goods sold was $5.44 million, and its average inventory balance was $1.67 million. a. Calculate the average number of days inventory outstanding ratios for HVHS. b. The average number of inventory days in the industry is 73 days. By how muchmust HVHS reduce its investment in inventory to improve its inventory days to meet the industry? (Hint: Use a 365-day year.)
Hubble Space Incorporated has the following data which includes inventory conversion period or ICP of the firms against which it benchmarks. The firm's new manager is looking into the company on how he could reduce its inventory enough to reduce its ICP to the benchmarks’ average. If this were done, by how much would inventories decrease? Assume a 365-day year. Cost of goods sold =P85,000; Inventory =P20,000; Inventory conversion period (ICP) =85.88; Benchmark inventory conversion period (ICP) =38.00 *
Hubble Space Incorporated has the following data which includes inventory conversion period or ICP of the firms against which it benchmarks. The firm's new manager is looking into the company on how he could reduce its inventory enough to reduce its ICP to the benchmarks' average. If this were done, by how much would inventories decrease? Assume a 365-day year. Cost of goods sold =P85,000; Inventory =P20,000; Inventory conversion period (ICP) =85.88; Benchmark inventory conversion period (ICP) =38.00 * P 7,316 P11,151 P 9,032 P10,036 O P 8,129
Palmer Co. had cost of goods sold of $7,576, ending inventory of $2,270, and average inventory of $2,167. Calculate the inventory turnover. Calculate the day’s sales in inventory. What do these ratios tell you about inventory management at Palmer Co. if the industry average is a turnover of 3.3 and the day’s sales in inventory is 130 days?
The cost of goods sold for Veltron International last year amounted to $561,000, and the average inventory at cost was $224,400. The published inventory turnover at cost is 6.6. Calculate the inventory turnover at cost, and if it is less than the published rate, calculate the target average inventory at cost (in $). (If the actual turnover is greater than the published rate, enter "above" for target average inventory.) Inventory turnover at cost Target average inventory at cost $ Need Help? Read It Watch It Master It
The cost of goods sold for Veltron International last year amounted to $547,800, and the average inventory at cost was $365,200. The published inventory turnover at cost is 6.6. Calculate the inventory turnover at cost, and if it is less than the published rate, calculate the target average inventory at cost (in $). (If the actual turnover is greater than the published rate, enter "above" for target average inventory.) Inventory turnover at cost Target average inventory at cost $
The ITM trading company provides you the following data for the year 2016: Inventory turnover ratio: 12 times Opening inventory at cost: $36,000 Closing inventory at cost: $54,000 Calculate cost of goods sold for the year 2016
Wayne's Wells has sales for the year of P48,900 and an average inventory 21 of P8,800. The cost of goods sold id equal to 60 percent of sales and the profit margin is five percent. How many days on the average does it take the firm to sell an inventory item?
Tinker's cost of goods sold in 2016 was $750,000 and the 2015 cost of goods sold was $770,000. The inventory at the end of 2016 was $188,000 and at the end of 2015 the inventory was $208,000. Tinker's average number of days to sell its inventory during 2015 was closest to: