Principles of Financial Accounting.
24th Edition
ISBN: 9781260158601
Author: Wild
Publisher: MCG
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Chapter 8, Problem 15E
a)
To determine
To determine the change in the number of days sales uncollected between year 1 and year 2.
b)
To determine
To determine if the company’s collection of receivables improving or not.
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Accounts Receivable Turnover and Average Collection Period
Verne Corporation disclosed the following financial information (in millions) in its recent annual report:
Previous Year Current Year
$167,096
$181,662
13,896
15,100
15,100
13,598
Net Sales
Beginning Accounts Receivable (net)
Ending Accounts Receivable (net)
a. Calculate the accounts receivable turnover ratio for both years. (Round your answer to two decimal points.)
b. Calculate the average collection period for both years. (Use 365 days for calculation. Round your answer to the nearest whole number.)
c is the company's accounts receivable management improving or deteriorating?
Previous Year
a Accounts receivable turnover
b. Average collection period
e. The company's receivable management Improved
Check
0x
0x
Current Year
DX
0x
✓
Accounts Receivable Analysis
The following data are taken from the financial statements of Basinger Inc. Terms of all sales are 2/10, n/45.
20Y3
20Y2
20Y1
Accounts receivable, end of year
$171,400
$179,000
$186,000
Sales on account
1,068,720
1,003,750
a. For 20Y2 and 20Y3, 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.
20Y3
20Y2
1. Accounts receivable turnover
fill in the blank 1
fill in the blank 2
2. Number of days' sales in receivables
fill in the blank 3
days
fill in the blank 4
days
b. The collection of accounts receivable has
. This can be seen in both the
in accounts receivable turnover and the
in the collection period.
Accounts Receivable Analysis
The following data are taken from the financial statements of Basinger Inc. Terms of all sales are 2/10, n/45.
20Y2
$212,000
1,423,500
a. For 20Y2 and 20Y3, 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.
20Y2
Accounts receivable, end of year
Sales on account
20Y3
$196,800
1,451,240
1. Accounts receivable turnover
2. Number of days' sales in receivables
20Y3
20Y1
days
$226,000
days
Chapter 8 Solutions
Principles of Financial Accounting.
Ch. 8 - Prob. 1MCQCh. 8 - Prob. 2MCQCh. 8 - Prob. 3MCQCh. 8 - Prob. 4MCQCh. 8 - Prob. 1DQCh. 8 - Prob. 2DQCh. 8 - Prob. 3DQCh. 8 - Prob. 4DQCh. 8 - Prob. 5DQCh. 8 - Prob. 6DQ
Ch. 8 - Which of the following assetsinventory, building,...Ch. 8 - What is a petty cash receipt? Who should sign it?Ch. 8 - Prob. 9DQCh. 8 - Prob. 10DQCh. 8 - Prob. 11DQCh. 8 - Prob. 12DQCh. 8 - Prob. 13DQCh. 8 - Prob. 1QSCh. 8 - COSO internal control components C1 COSO lists...Ch. 8 - Prob. 3QSCh. 8 - Prob. 4QSCh. 8 - Prob. 5QSCh. 8 - Prob. 6QSCh. 8 - Prob. 7QSCh. 8 - Prob. 8QSCh. 8 - Prob. 9QSCh. 8 - Prob. 10QSCh. 8 - Prob. 11QSCh. 8 - Prob. 1ECh. 8 - Prob. 2ECh. 8 - Prob. 3ECh. 8 - Prob. 4ECh. 8 - Prob. 5ECh. 8 - Prob. 6ECh. 8 - Prob. 7ECh. 8 - Prob. 8ECh. 8 - Prob. 9ECh. 8 - Prob. 10ECh. 8 - Prob. 11ECh. 8 - Prob. 12ECh. 8 - Prob. 13ECh. 8 - Prob. 14ECh. 8 - Prob. 15ECh. 8 - Prob. 16ECh. 8 - Prob. 1APCh. 8 - Prob. 2APCh. 8 - Prob. 3APCh. 8 - Prob. 4APCh. 8 - Prob. 5APCh. 8 - Prob. 1BPCh. 8 - Prob. 2BPCh. 8 - Prob. 3BPCh. 8 - Prob. 4BPCh. 8 - Prob. 8SPCh. 8 - Prob. 1AACh. 8 - Prob. 2AACh. 8 - Prob. 3AACh. 8 - Prob. 1BTNCh. 8 - Prob. 2BTNCh. 8 - Prob. 3BTNCh. 8 - Prob. 4BTNCh. 8 - Review the opening feature of this chapter that...Ch. 8 - Prob. 6BTN
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