Question

Home - Gateway Ch 17 HW problem CengageNOWV2 Online teaching and learnin... dashboard - enroll Book Show Me How Calculator Accounts Receivable Analysis The following data are taken from the financial statements of Basinger Inc. Terms of all sales are 2/10, 1/45. 20Y3 2012 2011 Accounts receivable, end of year $142,000 $150,000 $156,600 Sales on account 817,600 766,500 a. For 2012 and 2043, determine (1) the accounts receivable turnover and (2) the number of days' sales in receivables. Round interim calculations to the nearest dollar and final answers to one decimal place. Assume a 365-day year. 2013 2012 1. Accounts receivable turnover days days 2. Number of days' sales in receivables in accounts receivable turnover and the This can be seen in both the b. The collection of accounts receivable has in the collection period. Previous Next

Answer 1

Notes

20Y3 20Y2

1. Accounts receviable Turnover 5.6 times 5 times

2. Number of days sales in receviables 65.18/66days 73 days

Which means on an average company is collecting its receviables in 66(20Y3) , 73(20Y2) days, but the companies

net term policy is within 45 days.That means accounts collection delayed by (66 -45 ) = 21 days and ( 73 - 45 ) = 28 days. Please find workings below. Thank you plz upvote.

a)	Account Receviables Turn over Ratio =	Net Credit Sales
AverageAccounts Receviables
1	Average Account Receviables =	Opening + Closing Account receviable
		2
	20Y3
	Average Account Receviables =	142000 + 150000	146000
	2
	Account Receviables Turn over Ratio =	817600	5.6
	146000
	20Y2
	Average Account Receviables =	150000 + 156600	153300
	2
	Account Receviables Turn over Ratio =	766500	5
	153300
2	Number of days Sales in Receviables =	Average accounts receviables	X 365
	Sales
	20Y3
	Number of days Sales in Receviables =	146000	X 365
	817600	65.18 Days
	20Y2
	Number of days Sales in Receviables =	153300	X 365
	766500	73 Days