Bell Company Has Provided the Following Figures as of December

question 53

True/False

Bell Company has provided the following figures as of December 31, Year 2: sales of $600,000, cost of goods sold of $320,000, net income of $120,000, and ending inventory of $64,000. Indicate whether each of the above statements pertaining to the Bell Company is true or false.________ a)Bell's inventory turnover is 5.0.________ b)Bell's average number of days to sell inventory is 39.5.________ c)Bell could increase its inventory turnover by increasing prices.________ d)Bell's gross margin as a percentage of sales was 46.7%.________ e)A local competitor in the same line of business has an inventory turnover of 3.5.
Assuming each firm has approximately the same gross margin rate, Bell Company is likely to be more profitable than the competitor.

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Definitions:

Division of Labor

The breakdown of work into smaller, specialized tasks or roles, intended to increase efficiency and productivity.

Job Specialization

Job specialization is the process of focusing one's occupational concentration on a specific area of expertise, enhancing efficiency and proficiency.

Vertical Organization

A management structure where hierarchy is emphasized, with clear lines of authority and responsibility flowing from top to bottom.

Span of Control

The number of subordinates a manager or supervisor can directly control. This number varies with the complexity of tasks.