Blue, Inc., sells playground equipment to schools and municipalities. It mails invoices at the end of each month for all goods shipped during that month; credit terms are net 30 days. Sales and accounts receivable data for 20X1, 20X2, and 20X3 follow: Years Ending December 31, 20X1 20X2 20X3 Sales $ 1,785,980 $ 1,839,559 $ 1,986,724 Accounts receivable at year-end 220,189 227,896 267,094 Required: Calculate the rates of increase in sales and in receivables during 20X2 and 20X3. (Do not round intermediate calculations. Round "Sales grew" answers to the nearest whole percent and "Receivables grew" answers to 1 decimal place.) Do your calculations indicate any potential problems with Blue’s receivables?
Blue, Inc., sells playground equipment to schools and municipalities. It mails invoices at the end of each month for all goods shipped during that month; credit terms are net 30 days. Sales and accounts receivable data for 20X1, 20X2, and 20X3 follow: Years Ending December 31, 20X1 20X2 20X3 Sales $ 1,785,980 $ 1,839,559 $ 1,986,724 Accounts receivable at year-end 220,189 227,896 267,094 Required: Calculate the rates of increase in sales and in receivables during 20X2 and 20X3. (Do not round intermediate calculations. Round "Sales grew" answers to the nearest whole percent and "Receivables grew" answers to 1 decimal place.) Do your calculations indicate any potential problems with Blue’s receivables?
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Question
Blue, Inc., sells playground equipment to schools and municipalities. It mails invoices at the end of each month for all goods shipped during that month; credit terms are net 30 days. Sales and accounts receivable data for 20X1, 20X2, and 20X3 follow:
Years Ending December 31,
20X1 20X2 20X3
Sales $ 1,785,980 $ 1,839,559 $ 1,986,724
Accounts receivable at year-end 220,189 227,896 267,094
Required:
Calculate the rates of increase in sales and in receivables during 20X2 and 20X3. (Do not round intermediate calculations. Round "Sales grew" answers to the nearest whole percent and "Receivables grew" answers to 1 decimal place.)
Do your calculations indicate any potential problems with Blue’s receivables?
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