Question

A firm has sales of $1,070, net income of $211, net fixed assets of $514, and current assets of $270. The firm has $86 in inventory. What is the common-size balance sheet value of inventory

Answer 1

Answer:

10.97$

Step-by-step explanation:

Calculation of the common-size balance sheet value of inventory

Inventory = $86

Total Assets = Current Assets + Net Fixed Assets

Total Asset = $270+ $514

Total Asset= $784

Using this formula

Common-size balance sheet value of inventory = Inventory / Total asset

Let plug in the formula

= $86/$784

= 0.1097×100

= 10.97%

Therefore the common-size balance sheet value of inventory will be 10.97%