The following data are taken from or calculated from the financial statements: CurrentPreceding YearYearAverage accounts receivable (net)$123,000$ 95,000Sales on account950,000825,000(a)Assuming that credit terms on all sales are n/45, determine for each year (1) the accounts receivable turnover and (2) the number of days' sales in receivables.Round intermediate calculations to whole numbers and final answers to two decimal places.(b)Comment on any significant trends revealed by the data.

Solution: A) 1) Accounts receivable turnover = Net Credit sales / Average accounts receivable…

Answered: The following data are taken from or…

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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The following data are taken from or calculated from the financial statements:

	Current	Preceding
	Year	Year
Average accounts receivable (net)	$123,000	$ 95,000
Sales on account	950,000	825,000

(a)	Assuming that credit terms on all sales are n/45, determine for each year (1) the accounts receivable turnover and (2) the number of days' sales in receivables. Round intermediate calculations to whole numbers and final answers to two decimal places.
(b)	Comment on any significant trends revealed by the data.

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