Analyze Signet Jewelers. Signet Jewelers uses the straight-line deprecation method.
Rebecca Cline
For this discussion, continue to analyze Signet Jewelers. Signet Jewelers uses the straight-line deprecation method.
Average life = 741.9 /178 = 4.17 years Average age = 1064.7/178 = 5.98 years Asset turnover ratios = 2223.7/6299.1 = 35.3%(FY 2020 Annual Report, 2020)Signet Jewelers gets a good return on their investment when it comes to average lie of property, plant, and equipment. Their 4.17 years appears to be helping the company continue to grow stronger. The average age of long-term assets at Signet Jewelers is 5.98 years. Combined with the asset turnover ratio of 35.3% on ever dollar, Signet Jewelers has a nice correlation to continue to profit over time. Accounts receivable turnover ratio = 2223.7/38.8 = 57.3Convert that ratio into days = 365/57.3 = 6.37(FY 2020 Annual Report, 2020)Accounts receivable turnover ratio recognizes how efficient a company accumulates on their receivables, and also calculates the credit that is being provided to customers. Signet Jewelers has an accounts receivable turnover ratio of 57.3. This shows that Signet Jewelers converted its receivables into cash 57.3 times last year. When the accounts receivable turnover ratio is converted into days, Signet Jewelers number of days receivable is 6.37. This tells you how many days a balance is outstanding before it is paid off. This seems low to me considering you can finance jewelry for much longer terms. For example, Zales, one of the brands under Signet Jewelers, offers financing for up to 36 months, or approximately 1095 days.Resources:FY 2020 Annual Report. Signet Jewelers. (2020, May 1). https://s26.q4cdn.com/755441662/files/doc_financials/annual/Signet-2020-Annual-Report.pdf
Answer preview to analyze Signet Jewelers. Signet Jewelers uses the straight-line deprecation method.
APA
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