Benson Company shows the following data on its 2014 financial statements: Accounts receivable, January 1 $720,000 Accounts receivable, December 31 $960,000 Merchandise inventory, January 1 $900,000 Merchandise inventory, December 31 $1,020,000 Gross sales $4,800,000 Sales returns and allowances $180,000 Net sales $4,620,000 Cost of goods sold $3,360,000 Income before interest and taxes $720,000 Interest on bonds $192,000 Net income $384,000 The accounts receivable turnover is: a. 5.5 times per year. b. $840,000; Accounts receivable turnover: $4,620,000/$840,000 = 5.5. c. 5 times per year. d. 6.667 times per year. e. 5.714 times per year.

Benson Company shows the following data on its 2014 financial statements: Accounts receivable, January 1 $720,000 Accounts receivable, December 31 $960,000 Merchandise inventory, January 1 $900,000 Merchandise inventory, December 31 $1,020,000 Gross sales $4,800,000 Sales returns and allowances $180,000 Net sales $4,620,000 Cost of goods sold $3,360,000 Income before interest and taxes $720,000 Interest on bonds $192,000 Net income $384,000 The accounts receivable turnover is: a. 5.5 times per year. b. $840,000; Accounts receivable turnover: $4,620,000/$840,000 = 5.5. c. 5 times per year. d. 6.667 times per year. e. 5.714 times per year.

Managerial Accounting: The Cornerstone of Business Decision-Making

7th Edition

ISBN:9781337115773

Author:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger

Publisher:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger

Chapter15: Financial Statement Analysis

Section: Chapter Questions

Problem 56P: The following selected information is taken from the financial statements of Arnn Company for its...

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