The annual sales of a company are $47,000 including sales tax at 17.5%. Half of the sales are on credit terms; half are cash sales. The receivables are $4,700. What is the trade receivables collection period (to the nearest day)? A 37 days B 43 days C 73 days D 86 days

The annual sales of a company are $47,000 including sales tax at 17.5%. Half of the sales are on credit terms; half are cash sales. The receivables are $4,700. What is the trade receivables collection period (to the nearest day)? A 37 days B 43 days C 73 days D 86 days

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Related questions

Q: A company has credit turnover of NOK 10 million this year. 31.12.x1 this year, trade receivables…

A: Average Credit time = Average Accounts receivable/Total Credit Sales*No. of days Average accounts…

Q: McEwan Industries sells on terms of 3/10, net 35. Total sales for the year are $1,947,000; 40% of…

A: Hi student Since there are multiple subparts, we will answer only first three subparts. If you want…

Q: ABCD Corporation has credit sales of $8,460,000 and receivables of $1,260,000. Assume there are 365…

A: Ratio analysis is one of useful technique used. Under this, various calculations are done on…

Q: New receivable balance c-1. If Maddox reduces its bank loans, which cost 12 gain or loss to the…

A: Accounts receivable is the total amount that is to be received from a customer in exchange for goods…

Q: A firm had credit sales of $15,750,000 last year and its days sales outstanding was 65 days. What…

A: Given, Credit sales = $15,750,000. Days sales outstanding = 65 days.

Q: dit terms of net 30. Its accounts are, on average, 7 days past due. Annual credit sales are $9.6…

A: The accounts receivable would be the proportionate annual credit sale amount pending on the balance…

Q: What is LoGo's payables deferral period (DPO)?

A: Payables deferral period (DPO) = Accounts payable/Credit purchases per day It is the number of days…

Q: The total of Accounts Receivable is $1000 while the Annual Sales is $7000. The Days Sales…

A: The days of sales outstanding is the number of days the company on average takes to collect the…

Q: A 33- day days sales outstanding is maintained by the Bebop Corporation. Each day, the company…

A: Days sales outstanding is one of important ratio used in business to evaluate efficiency of…

Q: As of January 1, 2021, NUBD Co. had an accounts receivable of P500,000. The sales for January,…

A: Given that, Opening balance of accounts receivables = P500000 Sales for the month of Jan = P1200000…

Q: average investment in accounts receivable?

A: Average investment in accounts receivable = Accounts receivable average collection period * Annual…

Q: ABCD Corporation has credit sales of $10,290,000 and receivables of $1,560,000. Assume there are 365…

A: In this we have to calculate the receivable turnover ratio using the formula.

Q: ccounts Receivable Analysis: A company reports the following Sales $649,700 64,970 Average accounts…

A: Ratio analysis: It is a method used to measure the liquidity, profitability, efficiency of the…

Q: Bulldogs Inc. sells on term 3/20, net 40. Total sale for the year are P1,200,000 on which 40% is…

A: Average amount of account Receivable = Days of sales outstanding x Sales / 360 Days of Sales…

Q: A firm had credit sales of $15,750,000 last year and its days sales outstanding was 65 days. What…

A: Days Sales Outstanding (DSO) is the measure the average number of days a business to receive…

Q: A company has a 30-day credit terms to its customers. It has a total of P120,000 in their accounts…

A: Ratio analysis: This is the quantitative analysis of financial statements of a business enterprise.…

Q: Thompson Wood Products has credit sales of $2,628,000 and accounts receivable of $627,800. Compute…

A: Average collection period is period required to receive cash money from the customers from initial…

Q: Al Sharif Company's Average Accounts Receivables is OMR 360,000 and total Sales is OMR 1,200,000.…

A: Credit sale=Total sale×100-Cash sale %=OMR 1,200,000×100-40%=OMR 720,000

Q: accounts receivable turno ratio of a company is 2, annual credit sales IS $ nat is the average…

A: Given, Accounts receivable turnover = 2 Annual credit sales = $719550

Q: Bingo Inc. sells on term 3/20, net 40. Total sale for the year are P1,200,000 on which 40% is cash…

A: Total sales = P1,200,000 Cash sales = 40%

Q: Receivables Investment Medwig Corporation has a DSO of 37 days. The company averages $9,750 in…

A: Accounts Receivables are the money due towards customers but not yet paid on account of goods sold…

Q: Medwig Corporation has a DSO of 27 days. The company averages $9,750 in sales each day (all…

A: The objective of the question is to calculate the average accounts receivable of Medwig Corporation…

Q: What is the receivales turnover and what is the average collection period (days sales outstanding) ?

A: Information Provided: Credit sales = $10,640,000 Receivables = $1,520,000

Q: The Malibu Corporation has annual credit sales of $25 million. The average collection period is 27…

A: Average collection period is the formula which is used for determining the average days will be…

Q: Medwig Corporation has a DSO of 21 days. The company averages $9,250 in sales each day (all…

A: Ratio analysis used identify the business performance of the company. It is used to measure…

Q: MULTIPLE CHOICE Milch Corporation sells on terms of net/90. Their accounts receivable are on…

A: The average investment in receivables can be estimated with the help of days sales outstanding…

Q: McEwan Industries sells on terms of 3/10, net 30. Total sales for the year are $1,537, 000; 40% of…

A: The day's sales outstanding refers to the number of days for which credit will be provided to all…

Q: Red Sun Company has a current accounts receivable balance of $350,000. Credit sales for the year…

A: The average collection period, also known as the day's sales outstanding (DSO), is a measure of how…

Q: Lipovetsky Corp. has the following data relating to accounts receivable at the end of the current…

A: The net realizable value for accounts receivable is calculated as gross account receivables minus…

Q: The Caccamisse Corporation has annual credit sales of $35 million. The average collection period is…

A: Sales are made on cash and credit basis. The amount to be collected from sales made on credit basis…

Q: ABCD Corporation has credit sales of $12,690,000 and receivables of $1,970,000. Assume there are 365…

A: Question is based on the concept of Financial ratios

Q: Gandi brothers has DSO of 22 days and its annual sales on account are $7,665,000. Assume number of…

A: Days sales outstanding = 22 days Annual sales = $7,665,000 Number of days in a year = 365 days…

Q: nider Industries sells on terms of 2/10, net 25. Total sales for the year are $600,000. Thirty…

A: Days Sales Outstanding means the number of days taken by the firm to collect the payment from their…

Q: nider Industries sells on terms of 2/10, net 35. Total sales for the year are $600,000. Thirty…

A: Days sales outstanding means the average number of days , a customer take , to make payment. This…

Q: Net Credit Sales = 12,000. Accounts receivable turnover = 18.8 times. Cost of goods sold = 2,000.…

A: average collection period in days = 365 days / accounts recievables turnover ratio Given that,…

Q: Medwig Corporation has a DSO of 36 days. The company averages $8,000 in sales each day (all…

A: DSO means days sales outstanding. It means number of days it takes credit sales to be converted into…

Q: Twist Corporation has a current accounts receivable balance of $357,615. Sales for the year just…

A: Days sales in receivable is calculated by dividing the number of days in a year by receivable…

Q: ve costs of trade credit to International’s non-discount customers? (Hint: Calculate sales/day based…

Concept explainers

Conversion Cycle

Conversion cycle is also known as cash cycle or net operating cycle. Conversion cycle refers to how much time a company takes to turn its investments which is done from stock or any other financial resources into cash flows from sales.

Question

The annual sales of a company are $47,000 including sales tax at 17.5%. Half of the sales are on credit terms;

half are cash sales. The receivables are $4,700.

What is the trade receivables collection period (to the nearest day)?

A 37 days

B 43 days

C 73 days

D 86 days

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

SEE SOLUTION Check out a sample Q&A here

Step 1

VIEW

Step 2

VIEW

Step by step

Solved in 2 steps

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.

Similar questions

NEKO Inc. sells on term 3/20, net 40. Total sale for the year are P1,200,000 on which 40% is cash sales. 30% pays on the 20th day and take discounts while the remaining customers always pay on time. What is the average amount of accounts receivable? (Use 360-day year)
A company has average accounts receivable of Rs. 10,00,000 and annual credit sales of Rs.60,00,000. Its average collection period would be a. 60.83 days b. 6.08 days c. 1.67 days d. 0.67 days
Medwig Corporation has a DSO of 25 days. The company averages $7,750 in sales each day (all customers take credit). What is the company's average accounts receivable? Assume a 365-day year. Round your answer to the nearest dollar.
Lupo, Inc., has an average collection period of 52 days. Its average daily investment in receivables is $70,300. Assume 365 days per year. a. What is the receivables turnover? (Do not round intermediate calculations and round your answer to 4 decimal places, e.g., 32.1616.) b. What are annual credit sales? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.)
Sweetens Cove, Incorporated, has weekly credit sales of $69400 and the average collection period is 23 days. What is the average accounts receivable figure?
A firm has sales of $1.4 million, and 10 percent of the sales are for cash. The year-end accounts receivable balance is $205,000. What is the average collection period? (Use 365 days in a year. Do not round intermediate calculation. Round the final answer to the 1 decimal place.) Average collection period days 76thjbnn
ABC Corp. has net credit sales of P1,440,000 yearly with credit terms of n/30, which is also the average collection period. BECK does not offer discounts for early payment; thus, customers take the full 30 days to pay. (Use 360 days/year) 1.What is the average receivable balance? 2.What is the accounts receivable turnover?
Medwig Corporation has a DSO of 17 days. The company averages $8,500 in sales each day (all customers take credit). What is the company's average accounts receivable? Assume a 365-day year. Round your answer to the nearest dollar.
Medwig Corporation has a DSO of 17 days. The company averages $3,500 in sales each day (all customers take credit). What are the company’s average accounts receivable?
Medwig Corporation has a DSO of 32 days. The company averages $8,000 in sales each day (all customers take credit). What is the company's average accounts receivable? Assume a 365-day year. Round your answer to the nearest dollar.
Medwig Corporation has a DSO of 24 days. The company averages $7, 750 in sales each day ( all customers take credit). What is the company's average accounts receivable? Assume a 365 day year. Round your answer to the nearest dollar. $
Use the following information to answer the question that follow:Net Income : $205,000Profit margin : 7.80%A/R : $151,642Credit sales : 60% of total sales Compute the days’ sales in receivables