Question

Marie's Clothing Store had an accounts receivable balance of $470,000

at the beginning of the year and a year−end balance of $590,000.

Net credit sales for the year totaled $2,200,000.

The average collection period of the receivables​ was: (Round any intermediary calculations to two decimal places and your final answer to the nearest​ day.)

88

days.

B.98

days.

C.78

days.

D.10

days.

Answer 1

Sol. Accounts Receivable at the beginnice: $470.000 Account Receivable at the end = $590,000 Net Credit Sales = $2,200,000 calculate the average Account st we need to Receivable & Beginning Account Receivabade z $4,70.000 Account Receivable - $ 590,000 ding The Average Account Recoirable as a cen - Beginning becguit Receivablet Ending Account Receivable 2 $ 470,000 + $ 590,000 2 - = $ 1060,000 2 = $530,000 out the account receivables turnover Now, we will find Rabio :- no e Account Receivable Turnover Rabia => z Net Credit Saule Average Account Receivable $ 2,200,000 $ 530,000 2.1509 times

- Arenage Collection period - 365 days Account Receivable Turnover Ratio VO For 365 days 4.1509 87.93 days OR 88 days Olotion (A.) 8 8 day's .