Respuesta :
Answer:
1. Current ratio is 2.02 times
2. Accounts receivable turnover ratio is 4.31 times
3. Average collection period in days are 84.68 days
4. Inventory turnover ratio is 6.38 times
5. Days in inventory is 57.21 days
Explanation:
The formulas and calculations are shown below:
1. Current ratio = Total Current assets ÷ total current liabilities
= $4,120 ÷ $2,030
= 2.02 times
2. Accounts receivable turnover ratio
= Credit sales ÷ average accounts receivable
where,
Average accounts receivable = (Opening balance of Accounts receivable + ending balance of Accounts receivable) ÷ 2
= ($1,950 + $1,880) ÷ 2
= $1,915 million
And, the net credit sale is $8,258 million
Now put these values to the above formula
So, the answer would be equal to
= $8,258 million ÷ $1,915 million
= 4.31 times
3. Average collection period in days = Total number of days in a year ÷ accounts receivable turnover ratio
= 365 days ÷ 4.31 times
= 84.68 days
4. Inventory turnover ratio =
= Cost of goods sold ÷ average inventory
where,
Average inventory = (Opening balance of inventory + ending balance of inventory) ÷ 2
= ($810 + $860) ÷ 2
= $835 million
And, the cost of good sold is $5,328 million
Now put these values to the above formula
So, the answer would be equal to
= $5,328 million ÷ $835 million
= 6.38 times
5. Days in inventory
= Total number of days in a year ÷ inventory turnover ratio
= 365 days ÷ 6.38 times
= 57.21 days