Suppose the following information was taken from the 2022 financial statements of FedEx Corporation, a major global transportation/delivery company (in millions) Accounts receivable (gross) Accounts receivable (net) Allowance for doubtful accounts Sales revenue Total current assets 2022 2021 $3,710 $4,520 3,450 4,350 260 170 35,880 38.380 7,160 7,284 Answer each of the following questions Calculate the accounts receivable turnover and the average collection period for 2022 for FedEx. (Round answers to 1 decimal place, eg. 12.5. the 345 days for calculation) eTextbook and Media Accounts receivable turnover The average collection period for 2022 times days Is accounts receivable a material component of the company's total current assets?
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At the end of the accounting period, a financial statement is prepared by every company, then at that time while preparing the financial statement, the company determines among its total receivable amount how much portion of receivables is collected by the company during that accounting period.
Accounts Receivable
The word “account receivable” means the payment is yet to be made for the work that is already done. Generally, each and every business sells its goods and services either in cash or in credit. So, when the goods are sold on credit account receivable arise which means the company is going to get the payment from its customer to whom the goods are sold on credit. Usually, the credit period may be for a very short period of time and in some rare cases it takes a year.
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