Bassett Stores Company and Fox Stores Inc. are large retail department stores. Both companies offer credit to their customers through their own credit card operations. Information from the financial statements for both companies for two recent years is as follows (all numbers are in millions):   Bassett Fox Merchandise sales $229,950   $321,200   Credit card receivables—beginning 37,356   66,625   Credit card receivables—ending 31,188   51,295   a.   (1) Determine the accounts receivable turnover for both companies. Round to one decimal place. Bassett Stores fill in the blank 1 Fox Stores fill in the blank 2       (2) Determine the days' sales in receivables for both companies. Assume there are 365 days in the year. Round intermediate calculations to the nearest whole dollar and final answers to one decimal place. Bassett Stores fill in the blank 3 days Fox Stores fill in the blank 4 days b.  What conclusion can be drawn regarding the two companies and their credit card policies?

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
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  1. Bassett Stores Company and Fox Stores Inc. are large retail department stores. Both companies offer credit to their customers through their own credit card operations. Information from the financial statements for both companies for two recent years is as follows (all numbers are in millions):

      Bassett Fox
    Merchandise sales $229,950   $321,200  
    Credit card receivables—beginning 37,356   66,625  
    Credit card receivables—ending 31,188   51,295  

    a.   (1) Determine the accounts receivable turnover for both companies. Round to one decimal place.

    Bassett Stores fill in the blank 1
    Fox Stores fill in the blank 2

          (2) Determine the days' sales in receivables for both companies. Assume there are 365 days in the year. Round intermediate calculations to the nearest whole dollar and final answers to one decimal place.

    Bassett Stores fill in the blank 3 days
    Fox Stores fill in the blank 4 days

    b.  What conclusion can be drawn regarding the two companies and their credit card policies?

     
     
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