Lowrate Communications is in the cellular telephone industry The following
Lowrate Communications is in the cellular telephone industry. The following selected information has been compiled for the company (in thousands of dollars):
Required:
a. In each of the three years presented, what percentage of the company’s total accounts receivable is estimated to be uncollectible?
b. In each of the three years presented, what percentage of the sales revenue is the bad debts expense?
c. Did Lowrate’s collection of accounts receivable improve or deteriorate over this three-year period?
d. What was Lowrate’s average collection period for 2016? Has this improved over the prior year?
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