Question
In: Finance
Route Canal Shipping Company has the following schedule for aging of accounts receivable: Age of Receivables...
Route Canal Shipping Company has the following schedule for
aging of accounts receivable:
|
Age of Receivables |
|||||
| (1) | (2) | (3) | (4) | ||
| Month of Sales |
Age of Account |
Amounts | Percent of Amount Due |
||
| April | 0–30 | $ | 212,220 | _______ | |
| March | 31–60 | 94,320 | _______ | ||
| February | 61–90 | 141,480 | _______ | ||
| January | 91–120 | 23,580 | _______ | ||
| Total receivables | $ | 471,600 | 100% | ||
a. Calculate the percentage of amount due for each
month.
b. If the firm had $1,572,000 in credit sales
over the four-month period, compute the average collection period.
Average daily credit sales should be based on a 120-day
period.
Part two:
Fisk Corporation is trying to improve its inventory control
system and has installed an online computer at its retail stores.
Fisk anticipates sales of 60,500 units per year, an ordering cost
of $4 per order, and carrying costs of $1.60 per unit.
a. What is the economic ordering
quantity?
b. How many orders will be placed during the
year?
c. What will the average inventory
be?
d. What is the total cost of ordering and
carrying inventory?
Solutions
Expert Solution
Greetings!
PART A :-
a. Calculation of Percentage of Amount Due:-
Formula:- 
| (1) | (2) | |||
| Month of Sales |
Age of Account |
|||
| April | 0–30 | 212,220 | 45% | |
| March | 31–60 | 94,320 | 20% | |
| February | 61–90 | 141,480 | 30% | |
| January | 91–120 | 23,580 | 5% | |
| Total receivables | 471,600 | 100% |
b. Average collection Period = 
=
= 36 Days
PART - TWO
a. Economic Order Quantity = 
= 550 Units
b.Total Order in a year = 
=110
Orders
c. Average Inventory 
= 275 Units
d. Total Ordering Cost = Total Oder in a Year * Odering cost per Order = 110 Orders * 4 = $ 440
Total Carrying Cost = Average Inventory * Carrying Cost / Unit =275 Units * $1.60 = $ 440
Regards!!
jeff jeffy answered 1 year agoRelated Solutions
Route Canal Shipping Company has the following schedule for aging of accounts receivable: Age of Receivables...
Route Canal Shipping Company has the following schedule for
aging of accounts receivable:
Age of Receivables
April 30, 20X1
(1)
(2)
(3)
(4)
Month of
Sales
Age of
Account
Amounts
Percent of
Amount Due
April
0–30
$
227,010
_______
March
31–60
129,720
_______
February
61–90
194,580
_______
January
91–120
97,290
_______
Total receivables
$
648,600
100%
a. Calculate the percentage of amount due for each
month.
b. If the firm had $1,692,000 in credit sales
over the four-month period, compute...
Route Canal Shipping Company has the following schedule for aging of accounts receivable: Age of Receivables...
Route Canal Shipping Company has the following schedule for
aging of accounts receivable: Age of Receivables April 30, 20X1 (1)
(2) (3) (4) Month of Sales Age of Account Amounts Percent of Amount
Due April 0–30 $ 201,390 _______ March 31–60 115,080 _______
February 61–90 172,620 _______ January 91–120 86,310 _______ Total
receivables $ 575,400 100% a. Calculate the percentage of amount
due for each month. b. If the firm had $1,644,000 in credit sales
over the four-month period, compute...
Route Canal Shipping Company has the following schedule for aging of accounts receivable: Age of Receivables...
Route Canal Shipping Company has the following schedule for
aging of accounts receivable:
Age of Receivables
April 30, 20X1
(1)
(2)
(3)
(4)
Month of
Sales
Age of
Account
Amounts
Percent of
Amount Due
April
0–30
$
175,440
_______
March
31–60
87,720
_______
February
61–90
131,580
_______
January
91–120
43,860
_______
Total receivables
$
438,600
100%
a. Calculate the percentage of amount due for each
month.
b. If the firm had $1,548,000 in credit sales over
the four-month period, compute...
Drumpf suppy has the following accounts receivable aging schedule as at december 31,2015. Accounts receivable Age...
Drumpf suppy has the following accounts receivable aging
schedule as at december 31,2015.
Accounts receivable Age
Amount
proportion expected to dedaulf
allowance required
current
$150,000
0.5%
1-30 days past due
$65,000
1.0%
31-45 days past due
$16,500
13.0%
46-90 days past due
$4,500
20.0%
91-135 days past due
$3,000
25.0%
over 135 days past due
$1,500
60.0%
The balance in drumpf's allowance for doubtful accounts at the
beginning of the year is $6,000(credit). During the year, accounts
in the total...
Aging of Receivables Schedule The accounts receivable clerk for Kirchhoff Industries prepared the following partially completed...
Aging of Receivables Schedule
The accounts receivable clerk for Kirchhoff Industries prepared
the following partially completed aging of receivables schedule as
of the end of business on November 30:
Not
Days Past Due
Past
Over
Customer
Balance
Due
1-30
31-60
61-90
90
Academy Industries Inc.
3,800
3,800
Ascent Company
5,400
5,400
Zoot Company
7,000
7,000
Subtotals
667,600
403,200
146,900
64,100
33,400
20,000
The following accounts were unintentionally omitted from the
aging schedule and not included in the subtotals above:
Customer...
Aging of Receivables Schedule The accounts receivable clerk for Kirchhoff Industries prepared the following partially completed...
Aging of Receivables Schedule
The accounts receivable clerk for Kirchhoff Industries prepared
the following partially completed aging of receivables schedule as
of the end of business on November 30:
Not
Days Past Due
Past
Over
Customer
Balance
Due
1-30
31-60
61-90
90
Academy Industries Inc.
2,800
2,800
Ascent Company
4,800
4,800
Zoot Company
9,000
9,000
Subtotals
910,500
550,000
200,300
87,400
45,500
27,300
The following accounts were unintentionally omitted from the
aging schedule and not included in the subtotals above:
Customer...
Aging of Receivables Schedule The accounts receivable clerk for Evers Industries prepared the following partially completed...
Aging of Receivables Schedule
The accounts receivable clerk for Evers Industries prepared the
following partially completed aging of receivables schedule as of
the end of business on November 30:
Not
Days Past Due
Past
Over
Customer
Balance
Due
1-30
31-60
61-90
90
Acme Industries Inc.
5,500
5,500
Alliance Company
4,600
4,600
Zollinger Company
11,100
11,100
Subtotals
759,300
458,600
167,000
72,900
38,000
22,800
The following accounts were unintentionally omitted from the
aging schedule and not included in the subtotals above:
Customer...
The accounts receivable clerk for Evers Industries prepared the following partially completed aging of receivables schedule...
The accounts receivable clerk for Evers Industries prepared the
following partially completed aging of receivables schedule as of
the end of business on July 31:
1
A
B
C
D
E
F
G
2
Days Past Due
Days Past Due
Days Past Due
Days Past Due
3
Customer
Balance
Not Past Due
1-30
31-60
61-90
Over 90
4
Acme Industries Inc.
3,300.00
3,300.00
5
Alliance Company
4,800.00
4,800.00
6
~~~~~
~~~~~
~~~~~
~~~~~
~~~~~
~~~~~
~~~~~
7
Zollinger Company
5,000.00...
Aging of Receivables Schedule The accounts receivable clerk for Kirchhoff Industries prepared the following partially completed...
Aging of Receivables Schedule
The accounts receivable clerk for Kirchhoff Industries prepared
the following partially completed aging of receivables schedule as
of the end of business on November 30:
Not
Days Past Due
Past
Over
Customer
Balance
Due
1-30
31-60
61-90
90
Academy Industries Inc.
4,900
4,900
Ascent Company
4,000
4,000
Zoot Company
10,200
10,200
Subtotals
806,000
486,800
177,300
77,400
40,300
24,200
The following accounts were unintentionally omitted from the
aging schedule and not included in the subtotals above:
Customer...
Aging of Receivables Schedule The accounts receivable clerk for Evers Industries prepared the following partially completed...
Aging of Receivables Schedule
The accounts receivable clerk for Evers Industries prepared the
following partially completed aging of receivables schedule as of
the end of business on November 30:
Not
Days Past Due
Past
Over
Customer
Balance
Due
1-30
31-60
61-90
90
Acme Industries Inc.
3,600
3,600
Alliance Company
6,000
6,000
Zollinger Company
8,900
8,900
Subtotals
873,000
527,200
192,100
83,800
43,700
26,200
The following accounts were unintentionally omitted from the
aging schedule and not included in the subtotals above:
Customer...
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