The following data exist for Conner Company: 20x8 20x7 Accounts Receivable $ 80,000 $ 90,000 Sales...

The following data exist for Conner Company: 20x8 20x7 Accounts Receivable $ 80,000 $ 90,000 Sales 522,000 410,500 Calculate the receivable turnover and the average days' sales uncollected for 20x8.

Expert Solution

Accounts receivable turnover for 20X8 = 6.14 Times

Accounts receivable turnover ratio = Sales / Average Debtors

= $ 5,22,000 / [($80,000+$90,000)/2]

= $ 5,22,000 / $ 85,000

= 6.14 Times

Average days' sales uncollected for 20X8

Average days' sales uncollected = [ Accounts receivable / Net Sales ] * 365 Days

= [ $ 80,000 / $ 5,22,000 ] * 365 Days

= 55.9 Days

ekkarill92 answered 1 year ago

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