P6-4 (Algo) Preparing an Income Statement and Computing the Receivables Turnover Ratio with Discounts, Returns, and Bad Debts LO6-1, 6-2, 6-3 [The following information applies to the questions displayed below.] Tungsten Company, Incorporated, sells heavy construction equipment. There are 12,000 shares of capital stock outstanding. The annual fiscal period ends on December 31. The following condensed trial balance was taken from the general ledger on December 31, Current Year: Account Titles Cash Accounts receivable (net) Inventory, ending Operational assets Accumulated depreciation Liabilities Capital stock Retained earnings, January 1, Current Year Sales revenue Sales returns and allowances Cost of goods sold Administrative expense Selling expense Bad debt expense Sales discounts Income tax expense Totals Debit $34,800 Credit 15,700 52,400 41,200 $17,300 25,600 72,000 16,280 148,300 6,100 80,100 14,500 15,700 2,900 7,300 8,780 $279,480 $279,480 P6-4 Part 2 2. The beginning balance in Accounts Receivable (net) was $16,700. Compute the receivables turnover ratio. Receivables Turnover Ratio Numerator Denominator Net sales $ 279,480 1.00 times Average net trade accounts receivable $ 279,480