A recent annual report for FedEx contained the following data: Required: 1. Determine the receivables turnover ratio
Question:
A recent annual report for FedEx contained the following data:
Required:
1. Determine the receivables turnover ratio and average days sales in receivables for the current year.
2. Explain the meaning of each calculated number.
Accounts receivable Less: Allowances Net accounts receivable Net sales (assume all on credit) (dollars in thousands) Current Year $ 9,416,000 300,000 $ 9,116,000 $69,693,000 Previous Year $8,882,000 401,000 $8,481,000
Step by Step Answer:
Req 1 Dollar amounts in thousands 9116000 8481000 2 Req 2 The ...View the full answer
Financial Accounting
ISBN: 9781264229734
11th Edition
Authors: Robert Libby, Patricia Libby, Frank Hodge
Related Video
Days sales outstanding (DSO) is a measure of the average number of days that it takes a company to collect payment for a sale. DSO is often determined on a monthly, quarterly, or annual basis. To compute DSO, divide the average accounts receivable during a given period by the total value of credit sales during the same period and multiply the result by the number of days in the period being measured.
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