Question

Comparative figures for Apple and Google follow. Apple Google Current One Year Two Years Current One Year $ millions Accounts receivable, net Two Years Prior Year Prior Prior Year Prior $ 17,874 229,234 $15,754 215, 639 $ 16,849 233,715 $ 18,336 110,855 $14,137 90,272 $11,556 74,989 Net sales Required: 1. Compute the accounts receivable turnover for (a) Apple and (b) Google for each of the two most recent years using the data shown. 2. Compute how many days, on average, it takes to collect receivables for the two most recent years for (a) Apple and (b) Google 3. Which company more quickly collects its accounts receivable in the current year? Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 Compute the accounts receivable turnover for (a) Apple and (b) Google for each of the two most recent years using the data shown. (Round your answers to 1 decimal place.) Accounts Receivable Turnover Current Year Prior Year times times a. Apple times b. Google times Required 2

Answer 1

The answer has been presented to the supporting sheet. All the parts has been solved with detailed explanation and calculation. For detailed answer refer to the supporting sheet.

AB G Н. Answer 2 Part 1) Account Receivable Turnover Current Year Prior Year 13.6 Times 13.2 Times 6.8 times 7.0 times 5 a 6 b Apple Google 7 8 Formula 9 Account receivable Turnover Ratio = net sales/((beginning recevable +ending receivable)/2) 11 Part 2) Account Collection Period Current Year Prior Year 26.8 Days 27.6 Days 53.5 Days 51.9 Days 14 a 15 b Apple Google 16 17 18 Account collection Period = 365/(net sales/((beginning recevable tending receivable)/2)) 19 20 Part 3) 21 Apple Company collects its account receivable more quickly in current year 23 Thus the correct answer is Apple company 24 25 Note the intermediate calculations has not been rounded off but final answers has been rounded off to 1 decimal places KIM Sheet144 Sheet145 Sheet146 Sheet147 Sheet148 Sheet149 Sheet150 *