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17-2
Number of days’ sales in inventory ab 95.7 132.2
a. Average Total2 Rp 273,500 Rp 297,000
Cost of goods sold Rp1,043,000 Rp 820,000
b. Average daily cost of goods sold COGS365 days
Rp2,858 Rp2,247
2008 2007
Number of Days’ Sales in Inventory
PT Latuconsina in ‘000 Rp
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Example Exercise 17-5
17-2
A company reports the following: Cost of goods sold
Rp560,000,000 Average inventory
112,000,000 Determine a the inventory turnover and
b the number of days’ sales in inventory. Round to one decimal place.
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For Practice: PE 17-5A, PE 17-5B Follow My Example 17-5
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17-2
a. Inventory Turnover = Cost of Goods SoldAverage Inventory
Inventory Turnover = Rp560,000,000Rp112,000,000
Inventory Turnover = 5.0
b. Number of Days’ Sales in Inventory = Average Inventory
Average Daily Cost of Goods Sold
Number of Days’ Sales in Inventory = Rp112,000,000 Rp560,000,000365
Number of Days’ Sales in Inventory =Rp112,000,000Rp1,534,000
Number of Days’ Sales in Inventory = 73.0 days
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17-2
Ratio of Fixed Assets to Long-Term Liabilities
The ratio of fixed assets to
long- term liabilities
is a solvency measure that indicates the margin of safety of
the noteholders or bondholders. It also indicates the ability of the
business to borrow additional funds on a long-term basis.
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17-2
2008 2007
Ratio of fixed assets to long-term liabilities ab 4.4 2.4
a. Fixed assets net Rp444,500 Rp470,000
b. Long-term liabilities Rp100,000 Rp200,000
17-2
PT Latuconsina in ‘000 Rp
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17-2
Ratio of Liabilities to Stockholders’ Equity
The relationship between the total claims of the creditors and
owners —the
ratio of liabilities to stockholders’ equity
—is a
solvency measure that indicates the margin of safety for creditors.
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17-2
Ratio of liabilities to stockholders’ equity ab 0.4 0.6
a. Total liabilities Rp310,000 Rp443,000
