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    Inventory turnover comparison to industry leaders: Widget Inc.

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    Widget Inc wants to compare its inventory turnover to those of industry leaders, who have turnover of 13 times per year and 8% of their assets invested in inventory.

    a. What is Widget Inc inventory turnover?
    b. What is Widget Inc percent of assets committed to inventory?
    c. How does Widget Inc's performance compare to industry leaders?

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    Solution Preview

    Inventory Turnover = Cost of Goods Sold / Average Inventory
    Where Average Inventory = (Beginning Inventory + Ending Inventory) / 2
    Since we only have information regarding ...

    Solution Summary

    Inventory turnover comparison to industry leaders for Widget Inc is examined in the solution. The percent of assets committed to inventory is discussed.