The general merchandise retail industry has a number of segments represented by the following companies:
|
Company Name |
Merchandise Concept |
|
Costco Wholesale Corporation |
Membership warehouse |
|
Wal Mart |
Discount general merchandise |
|
JCPenney |
Department store |
For a recent year, the following cost of merchandise sold and beginning and ending inventories have been provided from corporate annual reports for these three companies:
|
|
Costco |
Wal Mart |
JCPenney |
|
Cost of merchandise sold |
$42,092 |
$219,793 |
$11,285 |
|
Merchandise inventory, beginning |
3,339 |
26,612 |
3,156 |
|
Merchandise inventory, ending |
3,644 |
29,447 |
3,169 |
a. Determine the inventory turnover ratio for all three companies. Round to one decimal place.
b. Determine the number of days’ sales in inventory for all three companies. Round to one decimal place.
c. Interpret these results based upon each company’s merchandise concept.