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This is a very simple calculation. Days to Sell Inventory(or Days in Inventory) = Average Inventory / Annual Cost of Goods Sold /365 Average Inventory = (Beginning Inventory + Ending Inventory) / 2 To calculate this ratio for a quarter instead of a year use the following variation: Days to Sell Inventory (or Days in Inventory) = Average Inventory / "Quarterly" Cost of Goods Sold /"90" Average Inventory = (Beginning Inventory + Ending Inventory) / 2
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What is the inventory turnover ratio?
Inventory Turnover Ratio = Cost of Goods Sold / Average Inventory and Average Inventory = ( Beginning Inventory + Ending Inventory ) / 2
Is Increasing in turnover is good or bad?
An increase in inventory turnover is good. This means that over a certain period of time, the amount of times the inventory of a company was sold and replaced has increased.
What arer the problems caused by labor turnover?
Labour Turnover is the rate at which labour leaves the organisation or the rate at which new labour joins the organisation. Labour Turnover is usually expressed in terms of percentage and is an important tool under the various processes of Labour Costing.As said earlier, Labour Turnover is studied under Costing primarily. The other deprtment where it is studied is the Human Resource Department. Labour Turnover may or may not be in the favour of the company. The organisation may itself influence the Labour Turnover as dictated by its process of Man Power Planning.The problems associated with Labour Turnover are very predictable. These however arise only where the Labour Turnover is unfavourable to the organisation. Some problems can be:Increase in cost of operation.Decrease in productivity as the new people have to be trained.Delay in production.Change in work environment.Changes in Human Resource Principles, etc.
Do sales and cost of goods sold get recorded at the same time?
No. 1. If you do not have a computerized accounting system: Inventory manufactured or purchased for sale are first debited to "Inventory". When sold, you debit "bank, or accounts receivable" and credit "sales" At the end of the accounting period, which could be monthly or yearly, or anytime inbetween, usually after a physical inventory, you then reduce your inventory by crediting "Inventory" and charging the amount reduced to "Cost of Sales". 2. If you have a computerized accounting system: When you acquire the merchandise to be sold you debit it to a specific "card" in the program's memory of the "Inventory" account. When you sell it, you will debit "Bank or accounts receivable" and credit "Sales". In order to create your sales invoice, you will have to identify the "card" where the merchandise is posted. When you change accounting periods (a.i. May to June) the computerized accounting program will then process the sale by reducing the inventory and debiting "Cost of Sales" automatically.
Challenges affecting record management in Uganda?
povertycorruptiongovernment policypoor information technologyhigh costs to buy software and hardwarehigh staff turnover
