www.vustudents.ning.com

# Cost and management accounting (mgt 402).........Start date : 12 may 2016.........End date : 18 may 2016 )...Marks 10

Cost & Management Accounting (MGT402)

GDB # 01

Total Marks: 10

Case:

Following are the inventory turnover ratios of Global Company, Cosmos Company, SunStar Company and Galaxy Company for the financial year 2010, 2011 and 2012. SunStar and Galaxy Company manufacture heavy machinery whereas Global and Cosmos Company are retailers of general merchandise.

 Company FY-2010 FY-2011 FY-2012 Global Co. ? 6.78 6.81 Cosmos Co. 11.34 10.97 10.74 SunStar Co. 1.83 1.59 1.9 Galaxy Co. 3.97 3.78 4.12

Financial information of Global Company for financial year 2010 is as follows:

• Opening inventories-----------------Rs.  30,000
• Closing inventories------------------Rs.  41,000
• Cost of goods manufactured-------Rs. 261,000

Required:

1. In general, higher inventory turnover ratio indicates efficient operations carried out by an organization but a very high ratio is not considered good. Why is it so?
2. Calculate the missing figure for inventory turnover ratio of Global Company for year 2010 with the help of given data?
3. Can we compare inventory turnover ratio of Global Company with that of SunStar and Galaxy Company? Justify your answer with logical argument.

Views: 5096

### Replies to This Discussion

A high inventory turnover ratio mean the company has had unexpectedly strong sales -- a good sign. Or it could mean the firm is not managing its buying as well as it might and is having difficulty in administering its inventory

bint e ahmed ye meri wali thek nahi hay kya is main kya mistake hay please mujy clea ker do ap sub

This info might be helpful for GDB. Cost of good manufactured given ha , opening and closing inventories given hain, Is say hum cost of goods sold nikal sakty jo inventory turn over ratio formula ki requirement ha.

Cost of goods manufactured
+ opening finished goods inventory
-closing finished goods inventory
= cost of goods sold

Total factory cost

+ opening work in process inventory
-closing work in process
= cost of goods manufactured.

yes now u r right cost of good sold aisey hi niklay ga

can use this formula to find "
Beginning inventory + Purchases - Ending inventory = Cost of goods sold

Cost of Good Manufactured + Opening Inventory – Closing Inventory = Cost of Good Sold

Dear Students Don’t wait for solution post your problems here and discuss ... after discussion a perfect solution will come in a result. So, Start it now, replies here give your comments according to your knowledge and understandings....

MGT402 GDB#01 CLOSING DATE 18 MAY 2016 By Abid Mehmood

I think that Cost of Goods manufactured will be subtract from closing inventory amount however in case of Cost of Goods Sold there will no plus of minus of closing inventory amount. Please discuss and clear my idea

Opening inventory + cost of goods manufactured - closing inventory = cost of goods sold.
it is right .

1

2

3

4

5

## Latest Activity

ค๓ຖค ๖hคtti posted a video

### !!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!

5 minutes ago
6 minutes ago
6 minutes ago
+ M.Tariq Malik added a discussion to the group CS206 Introduction to Network Design & Analysis

### CS206 Assignment 01 Spring 2021 Solution / Discussion

7 minutes ago
+ IFRAH ANSAR liked Zohaib Hassan's discussion ذرا محتاط ہونا چاہیے تھا
34 minutes ago
ค๓ຖค ๖hคtti liked Zohaib Hassan's profile
37 minutes ago
38 minutes ago
ค๓ຖค ๖hคtti liked Zohaib Hassan's discussion ذرا محتاط ہونا چاہیے تھا
39 minutes ago