Question

The January 28, 2017 (fiscal year 2016) financial statements of Caleres, Inc. reported the following information (in thousands): 2016 2015 Cost of sales $1,517,397 $1,529,527 Inventories, net 585,764 546,745 LIFO reserve 4,345 4,094 The 2016 average days inventory outstanding is:

Answer 1

136.20 days

Step-by-step explanation:

Given that,

Opening inventory = 546,745

Closing inventory = 585,764

Cost of goods sold in 2016 = $1,517,397

Average inventory:

= (Opening inventory + Closing inventory) ÷ 2

= (546,745 + 585,764) ÷ 2

= 1,132,509 ÷ 2

= 566,254.5

Therefore, the average days inventory outstanding is calculated by the following formula:

= Average inventory ÷ (COGS/365 days)

= 566,254.5 ÷ ($1,517,397/365)

= 566,254.5 ÷ 4,157.3

= 136.20 days