Telecommunications Business

For the telecommunications business segment all of the firms operating within it

seem to have consistent as well as similar sales/ account receivables ratios. This

business segment pins Corning against all Japanese firms whose ratios appear to low

compared to most of the industry. Corning's telecommunications segment's ratio alone

is almost as high as the other firms in the industry. This may indicate that Corning's

telecommunications segment is very liquid compared to that of the larger segments or

maybe that the Japanese firms hold a lot of their sales on receivables or credit.

Inventory turnover, calculated by cost of goods sold divided by inventory, allows

firms to measure how effective a firm is in selling and replacing inventory each year.

The inventory turnover ratio is helpful when estimating the liquidity of a firm's inventory

and the accuracy of the current ratio since inventory is included in that ratios

calculation. A low inventory turnover implies the firm experiences low sales, which

results in a surplus of inventory. Corning has maintained an inventory turnover related

closest to the industry average. Corning's cost of sales and inventory both increase

slightly each year keeping the ratio relatively constant. Information shown in the table

and graph represent Corning's inventory turnover to follow closely with the industry

average, which represents average sales strength when compared to competitors. For

the past five years Furuwaka has maintained the highest inventory turnover relative to

the industry average, which reflects strong sales. NGK and Becton and Dickinson both

follow trends lower than the industry average, which reflects lower sales strength

compared to other firms within the industry.

Day Supply of Inventory = 365/Inventory T