FINANCIAL ACCOUNTING
10th Edition
ISBN: 9781259964947
Author: Libby
Publisher: MCG
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The following is select financial statement information from Vortex Computing:
| Year | Net Credit Sales | Ending |
| 2018 | $1,557,200 | $398,000 |
| 2019 | $1,755,310 | $444,400 |
| 2020 | $1,865,170 | $500,780 |
- Compute the accounts receivable turnover ratios and the number of days’ sales in receivables ratios for 2019 and 2020 (round answers to two decimal places):
- 2019 Accounts Receivable Turnover = ["", "", "", ""] times.
- 2019 Days' Sales in Receivables = ["", "", "", ""] days.
- 2020 Accounts Receivable Turnover = ["", "", "", ""] times.
- 2020 Days' Sales in Receivables = ["", "", "", ""] days.
- What do the outcomes tell a potential investor about Vortex Computing, if 2020 industry average for accounts receivable turnover ratio is 4.00 times and days’ sales in receivables ratio is 91.25 days?
- It takes Vortex Computing ["", "", ""] its competitors in the industry to collect on accounts receivable. If a lender were deciding between companies, Vortex Computing is ["", "", ""] in comparison to like businesses, given this ["", "", ""] in performance. Past data also suggests that the time to collect is ["", "", ""] from 2019 to 2020, which is something that might ["", "", ""] a lender or investor if this trend were to continue.
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