Question

Selected information taken from the accounting records of Vigor Company follows:
Net accounts receivable at December 31, 2013 .... $ 900,000
Net accounts receivable at December 31, 2014 .... $1,000,000
Accounts receivable turnover ............. 5 to 1
Inventories at December 31, 2013 ......... $1,100,000
Inventories at December 31, 2014 ......... $1,200,000
Inventory turnover .................. 4 to 1

Required:
1. What was Vigor’s gross profit for 2014?
2. Suppose that there are 360 business days in the year. What were the number of days sales outstanding in average receivables and the number of days sales outstanding in average inventories, respectively, for 2014?



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  • CreatedSeptember 10, 2014
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