tory is taken. BTN 5-9 Following are key figures (in millions of Korean won) for

ID: 2424933 • Letter: T

Question

tory is taken. BTN 5-9 Following are key figures (in millions of Korean won) for Samsung (wwy. Same which is a leading manufacturer of consumer electronics products. Current Year One Year Prior Two Year s Prior W in millions InventoryW19,134,868 W 17,747,413 W 15,716,715 Cost of sales 137,696,309 126,651,93 112,145,120 Required 1. Use these data and those from BTN 5-2 to compute (a) inventory turnover and (b) days' sales in imna tory for the most recent two years shown for Samsung, Apple, and Google. 2. Comment on and interpret your findings from part 1

Explanation / Answer

INVENTORY TURNOVER

FOR SAMSUNG ONE YEAR PRIOR

INVENTORY TURN OVER = COST OF GOODS SOLD / AVERAGE INVENTORY

= 126651931 / [(15716715 + 17747413) / 2]

= 126651931 / 16732064

= 7.57 TIMES

FOR SAMSUNG CURRENT YEAR

INVENTORY TURN OVER = COST OF GOODS SOLD / AVERAGE INVENTORY

= 137696309 / [(17747413 + 19134868) / 2]

= 137696309 / 18441140.5

= 7.47 TIMES

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FOR APPLE ONE YEAR PRIOR

INVENTORY TURN OVER = COST OF GOODS SOLD / AVERAGE INVENTORY

= 87846 / [(776 + 791) / 2]

= 87846 / 783.5

= 112.12 TIMES

FOR APPLE CURRENT YEAR

INVENTORY TURN OVER = COST OF GOODS SOLD / AVERAGE INVENTORY

= 106606 / [(791 + 1764) / 2]

= 106606 / 1277.5

= 83.45 TIMES

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FOR GOOGLE ONE YEAR PRIOR

INVENTORY TURN OVER = COST OF GOODS SOLD / AVERAGE INVENTORY

= 20634 / [(35 + 505) / 2]

= 20634 / 285

= 72.4 TIMES

FOR GOOGLE CURRENT YEAR

INVENTORY TURN OVER = COST OF GOODS SOLD / AVERAGE INVENTORY

= 25858 / [(505 + 426) / 2]

= 25858 / 931

= 27.77 TIMES

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DAYS SALES IN INVENTORY

FOR SAMSUNG ONE YEAR PRIOR