Problem 1216 Part Level Submission The following information

Problem 12-16 (Part Level Submission) The following information (in $ millions) was taken from the recent annual reports of two companies. Cost of goods sold Average inventory Company A $28,821 $2,617 Company B $24,140 $5,358 (a1) Your answer is correct. Calculate each company\'s inventory turnover. (Round answers to 1 decimal place, e.g. 2.5 Company A Company B 11.01 4.51 Inventory turnover times times

Solution

(a2) Company A:

Average days to sell inventory = 365 / 11.01 = 33.2 days

Company B:

Average days to sell inventory = 365 / 4.51 = 80.9 days