Surfwood Co. and Berrys Bait Inc. are similar companies that operate within the same industry. The following
Question:
Surfwood Co. and Berry’s Bait Inc. are similar companies that operate within the same industry. The following information is available:
Which company has the greater number of days in uncollected accounts in 2023? Is the days’ sales in receivables generally favourable or unfavourable? Which company is showing an unfavourable trend in terms of managing accounts receivable?
Days' sales in receivables Surfwood Co. Industry 2023 2022 2021 2023 Average 32 28.3 31.8 33.9 Berry's Bait 2022 2021 36.7 30.5 29.9
Step by Step Answer:
To determine which company has the greater number of days in uncollected accounts in 2023 we need to ...View the full answer
Horngrens Accounting Volume 1
ISBN: 9780136889373
12th Canadian Edition
Authors: Tracie Miller Nobles, Brenda Mattison, Ella Mae Matsumura
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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