Kurtz Company Has Provided the Following Figures as of December

question 97

Short Answer

Kurtz Company has provided the following figures as of December 31, 2013: Sales, $600,000; cost of goods sold, $320,000; net income, $120,000; inventory, $64,000. Indicate whether each of the above statements pertaining to the Kurtz Company is true or false.
_____ a) Kurtz's inventory turnover is 5.0.
_____ b) Kurtz's average number of days to sell inventory ratio is 39.5.
_____ c) Kurtz could increase its inventory turnover by increasing prices.
_____ d) Kurtz'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 6.5. Assuming each firm has approximately the same gross margin rate, Kurtz is likely to be more profitable than the competitor.

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