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cengagenow.com/ilm/takeAssignment/takeAssignmentMain.do?invoker- assignmentsSearch eBook Accounts Receivable Tunover and Number of Days' Sales in Receivables Financial statement data for years ending December 31 for Chiro-Solutions Company follows: Show Me How Caloulator Print item 2016 2015 Sales $2,912,000 $2,958,000 Accounts receivable: Beginning of year End of year 300,000 280,000 340,000 300,000 a. Determine the accounts receivable turnover for 2016 and 2015. Round your answers to one decimal place Accounts Receivable Turnover 2016 2015 b. Determine the number of days sales in receivables for 2016 and 2015. Use 365 days in a year in your computations. Round interim calcudations and your final answers to one decimal place. Number of Days' Sales in Receivables days 2016 days 2015 c. Does the change in accounts receivable turnover and the number of days' sales in receivables from 2015 to 2016 indicate a favor unfavorable trend? Unfavorable v check My Work Next 445 PM

Explanation / Answer

Calculate account receivable turnover :

b) No of days' sales in receivable = 365/account receivable turnover

2016 = 365/9.1 = 40.1 days

2015 = 365/10.2 = 35.8 days

c) Unfavorable

2016 2015 Average receivable (300000+340000/2) = 320000 (280000+300000/2) = 290000 Credit sales 2912000 2958000 Account receivable turnover 2912000/320000 = 9.1 2958000/290000 = 10.2

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