James Inc. currently has P750,000 in accounts receivable, and its day sales outstanding (DSO) is 55 days, It wants to reduce its DSO to 35 days by pressuring more of its customers to pay their bills on time. If this policy is adopted, the company's average sales will fall by 15%. What will be the level of accounts receivable following the change? Assume a 365-day year.
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- Problem 12 (DSO and Accounts Receivable) James Inc. currently has P750,000 in accounts receivable, and its day sales outstanding (DSO) is 55 days. It wants to reduce its DSO to 35 days by pressuring more of its customers to pay their bills on time. If this policy is adopted, the company's average sales will fall by 15%. What will be the level of accounts receivable following the change? Assume a 365-day year.Choose the correct letter and provide solution A firm has total annual sales (all credit) of P100,000.00 and accounts receivable of P20,000.00. How rapidly (in how many days) must accounts receivable be collected if management wants to reduce the accounts receivable to P15,000.00? *a. 22.8 daysb. 34.8 daysc. 44.8 daysd. 52.8 dayse. 54.8 days16. Problem 4.20 (DSO and Accounts Receivable) eBook Problem Walk-Through Ingraham Inc. currently has $790,000 in accounts receivable, and its days sales outstanding (DSO) is 61 days. It wants to reduce its DSO to 35 days by pressuring more of its customers to pay their bills on time. If this policy is adopted, the company's average sales will fall by 25%. What will be the level of accounts receivable following the change? Assume a 365-day year. Do not round intermediate calculations. Round your answer to the nearest cent.
- 10. Marca Leon is planning to change its credit policy. The proposed change is expected to shorten the collection period from 50 days to 30 days, increase the ratio of cash sales to total sales from 20% to 30%, and decrease total sales by 10%. 10 If projected sales for the coming year is P40,000,000, what is the difference on the average accounts receivable between the current and the proposed change in credit policy? Assume 360 days in a year. a. P2,344,444 b. P2,604,939 c. P4,938,272 d. cannot be determined4. Ruth Company currently has $1,000,000 in accounts receivable. Its days sales outstanding (DSO) is 50days. The company wants to reduce its DSO to the industry average of 32 days by pressuring more ofits customers to pay their bills on time. The company’s CFO estimates that if this policy is adopted thecompany’s average sales will fall by 10 percent. Assuming that the company adopts this change andsucceeds in reducing its DSO to 32 days and does lose 10 percent of its sales, what will be the level ofaccounts receivable following the change? Assume a 365-day year.eBook Problem Walk-Through Ingraham Inc. currently has $610,000 in accounts receivable, and its days sales outstanding (DSO) is 69 days. It wants to reduce its DSO to 30 days by pressuring more of its customers to pay their bills on time. If this policy is adopted, the company's average sales will fall by 5%. What will be the level of accounts receivable following the change? Assume a 365-day year. Do not round intermediate calculations. Round your answer to the nearest dollar $
- Choose the letter of answer and provide solution A firm has total annual sales (all credit) of P25,000.00 and accounts receivable of P8,000.00. How rapidly (in how many days) must accounts receivable be collected if management wants to reduce the accounts receivable to P6,000.00? *a. 87.6 daysb. 97.6 daysc. 107.6 daysd. 102.5 dayse. 105.8 days2. Harrelson Inc. currently has $750,000 in accounts receivable. Its days sales outstanding (DSO) is 55 days. It wants to reduce its DSO to the industry average of 35 days by pressuring customers to pay on time. The Chief Financial Officer (CFO) estimates that average sales will fall by 15% if the policy is adopted. Assuming the firms achieves the DSO of 35 days and suffers the 15% sales decline, what will be the new level of accounts receivable? Assume 1 year =365 daysA firm has total annual sales (all credit) of P1,200,000 and accounts receivable of P500,000. How rapidly (in how many days) must accounts receivable be collected if management wants to reduce the accounts receivable to P300,000? choose the letter of the correct answera. 51.3 daysb. 61.3 daysc. 71.3 daysd. 81.3 dayse. 91.3 days
- vv. Axis Wells and Excavation(AWE) currently generates 55,000 in annual sales. AWE sells on terms of net 50, and it’s accounts receivable balance averages $11,000. AWE is considering a new credit policy with terms of net 25. Under the new policy, sales will decrease to 36,000, and accounts receivable will average 12,000. Compute the days sales outstanding (DSO) under the existing policy and the proposed policy. Assume there are 360 days ina a year. Round your answer to the nearest whole number. DSO existing: Days DSO new: DaysA company plans to tighten its credit policy. The new policy will decrease the average number of days in collection from 75 to 50 days and will reduce the ratio of credit sales to total revenue from 70% - 60%. The company estimates that projected sales would be 5% less if the proposed new credit policy is implemented. If projected sales for the coming year are P50 million, calculate the estimated peso change in the firm's account receivable balance caused by this proposed change in credit policy. Assume a 365-day year. [Answer format: INCREASE 1234567]Please Solve This Question International Industries sells on terms of 3/10, net 50. Gross sales last year were 5,662,500 and accounts receivable averaged 547,500. Half of International’s customers paid on the 15th day and took discounts. What are the nominal and effective costs of trade credit to International’s non-discount customers? (Hint: Calculate sales/day based on a 360-day year, then calculate average receivables of discount customers and then find the DSO for the non-discount customers.