Answer:
B) cost of merchandise sold divided by average inventory.
Explanation:
Inventory turnover: It is a liquidity ratio that measures the number of times on average a company sold or replaced its inventory during the period. Computed as the cost of goods sold / by the average inventory on hand during the period. Analysts compute average inventory from the beginning and ending inventory balances. The ideal inventory turnover ratio is about 4 to 6, it is a rate at which restock item is well balanced with the sold inventory.
Answer:
$50,000
Explanation:
The preparation of the operating activities under the indirect method is shown below:
Cash flows from operating activities
Net loss -$12,000
Add: Depreciation expense $24,000
Add: Decrease in account receivable $28,000
Less: Increase in inventory -$20,000
Add: Increase in account payable $30,000
Cash provided from operating activities $50,000
The options are incorrect. The right answer is shown above
Answer:
total variable cost increases
Explanation:
Variable cost refers to the expenses that change with production volume. There is a direct relationship between variable costs and the level of production. An increase in the output level will result in a rise in variable costs. For sales volume to increase, the output level must have been high.
A high production level is necessary to support a high sales volume. Examples of variable costs are packaging and raw materials. A high output level will require the use of a large volume of raw materials, hence higher costs. Fixed cost contrast variable costs, as they do not change with varying output.
