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Question

A firm has sales of $1,420, net income of $236, net fixed assets of $544, and current assets of $500. the firm has $96 in inventory. what is the common-size statement value of inventory?

Answer

7.63%

  • Identify the formula to calculate common-size statement value of inventory.
  • Write down the formula: Common-size statement value of inventory = (Inventory / Total Assets) * 100
  • Calculate the total assets.
  • Total assets = Net Fixed Assets + Current Assets
  • Calculate the common-size statement value of inventory
  • Common-size statement value of inventory = (96 / (544 + 500)) * 100 = 7.63%