7. Analyze how well 3D Family Fireworks manages its receivables: a-1. Calculate the receivables turnover ratio for the month of January. (Hint: For the numerator, use total services provided to customers on account.) (Round your final answer to 1 decimal place.) a-2. If the industry average of the receivables turnover ratios for the month of January is 5.2 times, is the company collecting cash from customers more or less efficiently than other companies in the same industry? b-1. Calculate the ratio of Allowance for Uncollectible Accounts to Accounts Receivable at the end of January. (Round percentage to 1 decimal place.) b-2. Based on a comparison of this ratio to the same ratio at the beginning of January, does the company expect an improvement or worsening in cash collections from customers on credit sales?
7. Analyze how well 3D Family Fireworks manages its receivables: a-1. Calculate the receivables turnover ratio for the month of January. (Hint: For the numerator, use total services provided to customers on account.) (Round your final answer to 1 decimal place.) a-2. If the industry average of the receivables turnover ratios for the month of January is 5.2 times, is the company collecting cash from customers more or less efficiently than other companies in the same industry? b-1. Calculate the ratio of Allowance for Uncollectible Accounts to Accounts Receivable at the end of January. (Round percentage to 1 decimal place.) b-2. Based on a comparison of this ratio to the same ratio at the beginning of January, does the company expect an improvement or worsening in cash collections from customers on credit sales?
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question
![On January 1, 2024, the general ledger of 3D Family Fireworks includes the following account balances:
Accounts
Cash
Accounts Receivable
Allowance for Uncollectible Accounts
Supplies
Notes Receivable (6%, due in 2 years)
Land
Accounts Payable
Common Stock
Retained Earnings
Totals
Debit
$27,300
15,300
4, 200
21,000
80,600
a-1. The receivables turnover ratio is
a-2. The company collecting cash from customers
b-1. Allowance for Uncollectible Accounts ratio
b-2. The company expects an
$148,400
Credit
$1,600
During January 2024, the following transactions occur:
January 2
January 6
Provide services to customers for cash, $52,100.
Provide services to customers on account, $89,400.
January 15
Write off accounts receivable as uncollectible, $3,900. (Assume the company uses the allowance method)
Pay cash for salaries, $33,100.
January 20
January 22
Receive cash on accounts receivable, $87,000.
January 25
Pay cash on accounts payable, $7,200.
January 30 Pay cash for utilities during January, $15,400.
%
11,700
101,000
34,100
$148,400
7. Analyze how well 3D Family Fireworks manages its receivables:
a-1. Calculate the receivables turnover ratio for the month of January. (Hint: For the numerator, use total services provided to
customers on account.) (Round your final answer to 1 decimal place.)
a-2. If the industry average of the receivables turnover ratios for the month of January is 5.2 times, is the company collecting cash from
customers more or less efficiently than other companies in the same industry?
b-1. Calculate the ratio of Allowance for Uncollectible Accounts to Accounts Receivable at the end of January. (Round percentage to 1
decimal place.)
b-2. Based on a comparison of this ratio to the same ratio at the beginning of January, does the company expect an improvement or
worsening in cash collections from customers on credit sales?](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F0d26ba29-f06e-4901-83ae-8272fd349c12%2Fbe86024f-12ea-4080-be23-ae9a17c8d410%2Fuptyh4qs_processed.png&w=3840&q=75)
Transcribed Image Text:On January 1, 2024, the general ledger of 3D Family Fireworks includes the following account balances:
Accounts
Cash
Accounts Receivable
Allowance for Uncollectible Accounts
Supplies
Notes Receivable (6%, due in 2 years)
Land
Accounts Payable
Common Stock
Retained Earnings
Totals
Debit
$27,300
15,300
4, 200
21,000
80,600
a-1. The receivables turnover ratio is
a-2. The company collecting cash from customers
b-1. Allowance for Uncollectible Accounts ratio
b-2. The company expects an
$148,400
Credit
$1,600
During January 2024, the following transactions occur:
January 2
January 6
Provide services to customers for cash, $52,100.
Provide services to customers on account, $89,400.
January 15
Write off accounts receivable as uncollectible, $3,900. (Assume the company uses the allowance method)
Pay cash for salaries, $33,100.
January 20
January 22
Receive cash on accounts receivable, $87,000.
January 25
Pay cash on accounts payable, $7,200.
January 30 Pay cash for utilities during January, $15,400.
%
11,700
101,000
34,100
$148,400
7. Analyze how well 3D Family Fireworks manages its receivables:
a-1. Calculate the receivables turnover ratio for the month of January. (Hint: For the numerator, use total services provided to
customers on account.) (Round your final answer to 1 decimal place.)
a-2. If the industry average of the receivables turnover ratios for the month of January is 5.2 times, is the company collecting cash from
customers more or less efficiently than other companies in the same industry?
b-1. Calculate the ratio of Allowance for Uncollectible Accounts to Accounts Receivable at the end of January. (Round percentage to 1
decimal place.)
b-2. Based on a comparison of this ratio to the same ratio at the beginning of January, does the company expect an improvement or
worsening in cash collections from customers on credit sales?
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VIEWStep 3: Evaluate efficiency of company
VIEWStep 4: Calculate allowance for uncollectible accounts to accounts receivable at the end of January
VIEWStep 5: Calculate allowance for uncollectible accounts to accounts receivable at the beginning of January
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