Explain your answer with amounts. Days Sales Inventory Days Sales Receivables Analysis Company A 375,000/20,000-18.75 365/18.75.-19.46 19 days 800,000/40,000-20 365/20 18.25 18 days Company B 700,000/ 30,000 23.3 365/23.3 15.67 16 days 800,000/40,000 - 20 365/20 18.25 18 days

Explain your answer with amounts. Days Sales Inventory Days Sales Receivables Analysis Company A 375,000/20,000-18.75 365/18.75.-19.46 19 days 800,000/40,000-20 365/20 18.25 18 days Company B 700,000/ 30,000 23.3 365/23.3 15.67 16 days 800,000/40,000 - 20 365/20 18.25 18 days

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Question

Ef 450.

Which company does a better job of selling their inventory faster?
Explain your answer with amounts.
Days Sales Inventory
Days Sales Receivables
Analysis
Company A
375,000/20,000=18.75
365/18.75.-19.46
19 days
800,000/40,000=20
365/20=18.25
18 days
Company B
700,000/ 30,000 = 23.3
365/23.3 15.67
16 days
800,000/40,000=20
365/20 18.25
18 days

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