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Section B - Case 3
*OmniCart is an e-commerce retailer. The following financial data is available for the years ended 31 December:
20X5:
Revenue: $8,000,000
Cost of Sales: $5,000,000
Inventory: $500,000
Trade Receivables: $800,000
Trade Payables: $600,000
20X4:
Revenue: $6,000,000
Cost of Sales: $3,600,000
Inventory: $400,000
Trade Receivables: $500,000
Trade Payables: $450,000
Assume a 365-day year for all calculations.*
Question:
What is OmniCart's inventory turnover period (in days) for the year ended 31 December 20X5?
ACCA · Question 28 · Interpretation of Financial Statements
Section B - Case 3
*OmniCart is an e-commerce retailer. The following financial data is available for the years ended 31 December:
20X5:
Revenue: $8,000,000
Cost of Sales: $5,000,000
Inventory: $500,000
Trade Receivables: $800,000
Trade Payables: $600,000
20X4:
Revenue: $6,000,000
Cost of Sales: $3,600,000
Inventory: $400,000
Trade Receivables: $500,000
Trade Payables: $450,000
Assume a 365-day year for all calculations.*
Question:
Which of the following statements best explains the movement in OmniCart's Gross Profit Margin from 20X4 to 20X5?
Section B - Case 3
*OmniCart is an e-commerce retailer. The following financial data is available for the years ended 31 December:
20X5:
Revenue: $8,000,000
Cost of Sales: $5,000,000
Inventory: $500,000
Trade Receivables: $800,000
Trade Payables: $600,000
20X4:
Revenue: $6,000,000
Cost of Sales: $3,600,000
Inventory: $400,000
Trade Receivables: $500,000
Trade Payables: $450,000
Assume a 365-day year for all calculations.*
Question:
Which of the following statements best explains the movement in OmniCart's Gross Profit Margin from 20X4 to 20X5?
Answer options:
The Gross Profit Margin increased from 37.5% to 40%, indicating better control over supplier costs.
The Gross Profit Margin decreased from 40% to 37.5%, likely due to offering discounts to drive the higher sales volume.
The Gross Profit Margin remained constant, showing stable pricing power.
The Gross Profit Margin decreased from 60% to 62.5%, due to increased inventory holding costs.
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