Millennial Manufacturing has net credit sales for 2018 in the amount of $1,483,630, beginning accounts receivable balance of $588,900, and an ending accounts receivable balance of $626,450.A. Compute the accounts receivable turnover ratio and the number of days' sales in receivables ratio for 2018. Round answers to two decimal places.Accounts receivable turnover ratiofill in the blank 1 timesSales in receivables ratiofill in the blank 2 daysB. What do the outcomes tell a potential investor about Millennial Manufacturing if industry average is 2.6 times and number of day’s sales ratio is 180 days?a.Millennial Manufacturing collects its accounts more quickly than its competitors.b.A lender may favour Millennial Manufacturing over its competitors because of its faster collection period.c.Without prior years’ data it is hard to tell if Millennial Manufacturing is really more efficient than its competitors.d.All of the above statements may be correct. Millennial Manufacturing has net credit sales for 2018 in the amount of $1,483,630, beginning accounts receivable balance of $588,900, and an endingaccounts receivable balance of $626,450.A. Compute the accounts receivable turnover ratio and the number of days' sales in receivables ratio for 2018. Round answers to two decimal places.Accounts receivable turnover ratiotimesSales in receivables ratiodaysB. What do the outcomes tell a potential investor about Millennial Manufacturing if industry average is 2.6 times and number of day's sales ratio is 180 days?a. Millennial Manufacturing collects its accounts more quickly than its competitors.b. A lender may favour Millennial Manufacturing over its competitors because of its faster collection period.c. Without prior years' data it is hard to tell if Millennial Manufacturing is really more efficient than its competitors.d. All of the above statements may be correct.

Account receivable turnover ratio: = Net credit sales / Average account receivable Sales in…

Answered: Millennial Manufacturing has net credit…

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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Millennial Manufacturing has net credit sales for 2018 in the amount of $1,483,630, beginning accounts receivable balance of $588,900, and an ending accounts receivable balance of $626,450.

A. Compute the accounts receivable turnover ratio and the number of days' sales in receivables ratio for 2018. Round answers to two decimal places.

Accounts receivable turnover ratio	fill in the blank 1 times
Sales in receivables ratio	fill in the blank 2 days

B. What do the outcomes tell a potential investor about Millennial Manufacturing if industry average is 2.6 times and number of day’s sales ratio is 180 days?

a.	Millennial Manufacturing collects its accounts more quickly than its competitors.
b.	A lender may favour Millennial Manufacturing over its competitors because of its faster collection period.
c.	Without prior years’ data it is hard to tell if Millennial Manufacturing is really more efficient than its competitors.
d.	All of the above statements may be correct.

Millennial Manufacturing has net credit sales for 2018 in the amount of $1,483,630, beginning accounts receivable balance of $588,900, and an ending
accounts receivable balance of $626,450.
A. Compute the accounts receivable turnover ratio and the number of days' sales in receivables ratio for 2018. Round answers to two decimal places.
Accounts receivable turnover ratio
times
Sales in receivables ratio
days
B. What do the outcomes tell a potential investor about Millennial Manufacturing if industry average is 2.6 times and number of day's sales ratio is 180 days?
a. Millennial Manufacturing collects its accounts more quickly than its competitors.
b. A lender may favour Millennial Manufacturing over its competitors because of its faster collection period.
c. Without prior years' data it is hard to tell if Millennial Manufacturing is really more efficient than its competitors.
d. All of the above statements may be correct.

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