Urbanite Hip is a clothing store catering to collegestudents
and young professionals. It carries fashion merchandise and
wants to ensure that it is using inventory effectively. Costof
goods sold is $5,000,000, and average inventory in dollars is
$250,000.
a. What is their inventory turnover?
b. What is the weeks of supply, assuming 52 weeks per year?
c. Urbanite Hip is expecting to increase sales by 10% nextyear
while maintaining the same level of average inventory. How
will their inventory turnover and weeks of supply change?
