(Key comparativve figures for Apple and Google Apples: Current year(accounts rec
ID: 2419508 • Letter: #
Question
(Key comparativve figures for Apple and Google
Apples: Current year(accounts receivable $13,102, Net sales 170,910) , Prior year (accounts receivable: $10,930, net sales 156,508)
Google: Current year (accounts receivable $8,882, Net sales 59,825), Prior year (accounts receivable: $7,885, net sales 50,175
1. Compute days' sales uncollected (rounded to two decimals) for these comapnies for each of the two years shown. Comment on any trends for the companies.
2. Which company has the largest percent change (rounded to two decimals) in days' sales uncollected?
Explanation / Answer
1.
Apples:
Days' sales uncollected= Prior year = 10930 * 365 / 156508 = 25.49 days
Current year = 13102 * 365 /170910 =27.98 days
The number of days sales uncollected has increased by around 2.50 days i.e increase of 9.76%. Apple has performed badly upon its collection of accounts receivable.
Google:
Days' sales uncollected= Prior year = 7885 * 365 / 50175 = 57.36 days
Current year = 8882 * 365 / 59825 = 54.19 days
The number of days sales uncollected has decreased by around 3.17 days i.e increase of 5.52%. Google has improved upon its collection of accounts receivable.
2. Apple has the largest percent change of 9.76% in improving over its accounts receivable collection in comparison of Google, whose Days' sales uncollected has decreased by 5.52%.
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