Deacon Co. reported annual net sales for 2010 and 2011 of $565,000 and $647,000, respectively. Its yearend

Question:

Deacon Co. reported annual net sales for 2010 and 2011 of $565,000 and $647,000, respectively. Its yearend balances of accounts receivable follow: December 31, 2010, $51,000; and December 31, 2011, $83,000.

(a) Calculate its days’ sales uncollected at the end of each year.

(b) Evaluate and comment on any changes in the amount of liquid assets tied up in receivables.

Accounts Receivable
Accounts receivables are debts owed to your company, usually from sales on credit. Accounts receivable is business asset, the sum of the money owed to you by customers who haven’t paid.The standard procedure in business-to-business sales is that...