Arrow Distributing Corp. likes to track inventory by using weeks of supply as we

Question

Arrow Distributing Corp. likes to track inventory by using weeks of supply as well as by inventory turnover. Arrow Distributing Corp. Net Revenue Cost of sales Inventory Total assets $16,320 $13,310 $970 $8,470 a) What is its weeks of supply?weeks (round your response to two decimal places) b) What percent o Arrow's assets are committed to inventory? O% enter your response as a percentage rounded o two decimal places c) What is Arrow's inventory turnover?imes per year (round your response to two decimal places). d) Suppose a manufacturer has an inventory turnover of 13.5 times per year. Arrow's supply chain performance relative to the manufacture?s' as measured by inventory turnover, is

Explanation / Answer

a)

Weeks of supply = (Average inventory/Cost of goods sold)*52

Weeks of supply = (970/13310)*52 = 3.79

b) % invested in inventory = (inventory investment / Total assets) x 100

= (970/8470)*100 = 11.45%

c)

Inventory turnover = Cost of goods sold/Average inventory

Inventory turnover = 13310/970 = 13.72

d)

Good or better

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