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3 years ago

The following information is available for MVF Company(dollar amounts are in millions)

Business

1 answer:

Klio2033 [76]3 years ago

4 0

Answer:

2016 2015 2014 2013

gross profit% 26.29% 22.58% 22.45% 22.41%

Inventory turnover 6.58 7.64 7.6 7.94

cost of material % 59.89% 51.76% 89.82% 51.10

b. gross% has increased this may be due to a high demand, and intense marketing.

inventory turnover has decreased this may be due to new competition, or introduced product(new product)

cost of material purchased % it has increased in 2016, this may be due to increased production and effective use of material.

Explanation:

gross profit % =gross profit/ sales

gross profit = sales less cost of sales

inventory turnover = cost of sales / average inventory

average inventory = (opening inventory + closing inventory )/2

cost of material purchased/ cost of finished goods

finished goods = cost of sales + closing - opening goods

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