Following are data for December 31,2021: $5,365,000 Net sales Cost of sales, and related buying costs Accounts receivable, December 31, 2021 Accounts receivable, December 31, 2020 Merchandise inventories, December 31, 2021 Merchandise inventories, December 31, 2020 Assume 365 days in a year. 492,000 730,000 700,000 166,500 105,500
Following are data for December 31,2021: $5,365,000 Net sales Cost of sales, and related buying costs Accounts receivable, December 31, 2021 Accounts receivable, December 31, 2020 Merchandise inventories, December 31, 2021 Merchandise inventories, December 31, 2020 Assume 365 days in a year. 492,000 730,000 700,000 166,500 105,500
Intermediate Accounting: Reporting And Analysis
3rd Edition
ISBN:9781337788281
Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Chapter8: Inventories: Special Valuation Issues
Section: Chapter Questions
Problem 4MC
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Question
Number 2
![Following are data for December 31,2021:
Net sales
$5,365,000
Cost of sales, and related buying costs
Accounts receivable, December 31, 2021
Accounts receivable, December 31, 2020
Merchandise inventories, December 31, 2021
Merchandise inventories, December 31, 2020
492,000
730,000
700,000
166,500
105,500
Assume 365 days in a year.
Required:
1. Compute the accounts receivable turnover ratio in 2021:
times
Required Computation:
2. What is the average collection period, in days, for accounts receivable:
days
Required Computation:
3. Compute the inventory turnover for 2021.
Required Computation:
4. Compute the average length of time in days to sell inventory.
Required Computation:
%24](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Fa4390ff9-be31-4b08-a24a-9b9fb60c73a7%2F0fdb4db5-8b4b-4659-a0af-f4f848c86168%2Fbve08yo_processed.jpeg&w=3840&q=75)
Transcribed Image Text:Following are data for December 31,2021:
Net sales
$5,365,000
Cost of sales, and related buying costs
Accounts receivable, December 31, 2021
Accounts receivable, December 31, 2020
Merchandise inventories, December 31, 2021
Merchandise inventories, December 31, 2020
492,000
730,000
700,000
166,500
105,500
Assume 365 days in a year.
Required:
1. Compute the accounts receivable turnover ratio in 2021:
times
Required Computation:
2. What is the average collection period, in days, for accounts receivable:
days
Required Computation:
3. Compute the inventory turnover for 2021.
Required Computation:
4. Compute the average length of time in days to sell inventory.
Required Computation:
%24
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