Question

Based on the information in the table, and using a 365-day year, calculate Average Credit Sales per Day. Round the answers to two decimal places Balance Sheet December 31, 2014 Cash and marketable securities $132,000 Accounts payable $399,000 Accounts receivable $311,000 Notes payable $98,500 Inventories $512,000 Accrued expenses $89,300 Prepaid expenses $11,300 Total current liabilities $586,800 Total current assets $966,300 Long-term debt $799,400 Gross fixed assets $2,104,000 Par value and paid-in-capital $298,000 Less: accumulated depreciation $398,000 Retained Earnings $988,100 Net fixed assets $1,706,000 Common Equity 1,286,100 Total assets $2,672,300 Total liabilities and owner’s equity $2,672,300 Income Statement, Year of 2014 Net sales (all credit) $4,276,600.00 Less: Cost of goods sold $3,292,982.00 Selling and administrative expenses $349,000.00 Depreciation expense $148,000.00 EBIT $486,618.00 Interest expense $49,600.00 Earnings before taxes $437,018.00 Income taxes $174,807.20 Net income $262,210.80

Answer 1

First we have to make a profit and loss statement and balance sheet from the given data

Balance Sheet December 31, 2014
Cash and marketable securities	132000	Accounts payable	399000
Accounts receivable	311000	Notes payable	98500
Inventories	512000	Accrued expenses	89300
Prepaid expenses	11300	Total current liabilities	586800
Total current assets	966300	Long-term debt	799400
Gross fixed assets	2104000	Par value and paid-in-capital	298000
Less: accumulated depreciation	398000	Retained Earnings	988100
Net fixed assets	1706000	Common Equity	12,86,100
Total assets	2672300	Total liabilities and owner’s equity	2672300
Income Statement, Year of 2014
Net sales (all credit)	4276600
Less: Cost of goods sold	3292982
Selling and administrative expenses	349000
Depreciation expense	148000
EBIT	486618
Interest expense	49600
Earnings before taxes	437018
Income taxes	174807.2
Net income	262210.8
Now we need to find Average Credit sales per day
Average Credit sales per day		Total Credit Sales / No. of days in a year
		4276600 / 365
Answer is	=	11716.71233