Order ID:89JHGSJE83839 | Style:APA/MLA/Harvard/Chicago | Pages:5-10 |
Instructions:
Inventory Costing Method Case Assignment
Question Description
Based on the information on the next page, what inventory costing method does CarMax use? Do you believe this method is appropriate? Explain.
a). Calculate the common-size amount for inventories for both years and comment on any differences that you note. Given that the company is an automotive retailer, does this ratio seem appropriate?
b). At February 28, 2015, Inventory was $2,086,874 thousand. CarMax reports the cost of sales of $13,691,824 thousand for the year ended February 28, 2017 and $13,130,915 thousand for the year ended February 29, 2016. Compute the inventory turnover for both years. Interpret the ratio.
c). CarMax reports revenue of $15,875,118 thousand for the year ended February 28, 2017, and $15,149,675 thousand for the year ended February 29, 2016. Calculate gross profit margins for both years.
d). What is your opinion about the financial health of CarMax? Use the ratios you calculated above to support your opinion.
e). (This question does not pertain to CarMax) In general, discuss how companies can use the lower of cost or market (LCM) rule to manage earnings? Please research and find two companies that have recently written-down their inventory as a result of the LCM rule. Provide details of the inventory write-down.
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RUBRIC |
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Excellent Quality 95-100%
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Introduction
45-41 points The background and significance of the problem and a clear statement of the research purpose is provided. The search history is mentioned. |
Literature Support 91-84 points The background and significance of the problem and a clear statement of the research purpose is provided. The search history is mentioned. |
Methodology 58-53 points Content is well-organized with headings for each slide and bulleted lists to group related material as needed. Use of font, color, graphics, effects, etc. to enhance readability and presentation content is excellent. Length requirements of 10 slides/pages or less is met. |
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Average Score 50-85% |
40-38 points More depth/detail for the background and significance is needed, or the research detail is not clear. No search history information is provided. |
83-76 points Review of relevant theoretical literature is evident, but there is little integration of studies into concepts related to problem. Review is partially focused and organized. Supporting and opposing research are included. Summary of information presented is included. Conclusion may not contain a biblical integration. |
52-49 points Content is somewhat organized, but no structure is apparent. The use of font, color, graphics, effects, etc. is occasionally detracting to the presentation content. Length requirements may not be met. |
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Poor Quality 0-45% |
37-1 points The background and/or significance are missing. No search history information is provided. |
75-1 points Review of relevant theoretical literature is evident, but there is no integration of studies into concepts related to problem. Review is partially focused and organized. Supporting and opposing research are not included in the summary of information presented. Conclusion does not contain a biblical integration. |
48-1 points There is no clear or logical organizational structure. No logical sequence is apparent. The use of font, color, graphics, effects etc. is often detracting to the presentation content. Length requirements may not be met |
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Inventory Costing Method Case Assignment |
Inventory Costing Method Case Assignment