This table, shows that Blair Supply had an end-of-year accounts receivable balance of $300,075. The table...
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This table, shows that Blair Supply had an end-of-year accounts receivable balance of $300,075. The table also shows how much of the receivables balance originated in each of the previous six months. The company had annual sales of $2.40 million and it normally extends 30-day credit terms to its customers. a. Use the year-end total to evaluate the firm's collection system. b. If 70% of the firm's sales occur between July and December, would this affect the validity of your conclusion in part a? Explain. Data table (Click on the icon located on the top-right corner of the data table below in order to copy its contents into a spreadsheet.) Month of Amounts receivable origin July August September October November December Year-end accounts receivable $3,890 2,035 34,030 15,125 52,035 192,960 $300,075 This table, shows that Blair Supply had an end-of-year accounts receivable balance of $300,075. The table also shows how much of the receivables balance originated in each of the previous six months. The company had annual sales of $2.40 million and it normally extends 30-day credit terms to its customers. a. Use the year-end total to evaluate the firm's collection system. b. If 70% of the firm's sales occur between July and December, would this affect the validity of your conclusion in part a? Explain. Data table (Click on the icon located on the top-right corner of the data table below in order to copy its contents into a spreadsheet.) Month of Amounts receivable origin July August September October November December Year-end accounts receivable $3,890 2,035 34,030 15,125 52,035 192,960 $300,075
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a The firms collection system can be evaluated by determining Average Collection Period in days whos... View the full answer
Related Book For
Principles of Managerial Finance
ISBN: 978-0134476315
15th edition
Authors: Chad J. Zutter, Scott B. Smart
Posted Date:
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