ALei Industries has credit sales of $154 million a year. ALei's management reviewed its credit policy...

ALei Industries has credit sales of $154 million a year. ALei's management reviewed its credit policy and decided that it wants to maintain an average collection period of 40 days.

a. What is the maximum level of accounts receivable that ALei can carry and have a 40 -day average collection period?

b. If ALei's current accounts receivable collection period is 50 days, how much would it have to reduce its level of accounts receivable in order to achieve its goal of 40 days?

Expert Solution

AS NOTHING IS MENTIONED, ASSUMED 365 DAYS A YEAR.

ANSWERS ARE GIVEN IN MILLIONS AS WELL AS DOLLARS AS NOTHING WAS MENTIONED REGARDING IT. THANK YOU.

jeff jeffy answered 2 years ago

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