a. What is the accounts receivable turnover for each of the companies for 2016?

Question

a.

What is the accounts receivable turnover for each of the companies for 2016? (Round your answers to 1 decimal place.)

b.

What is the average days to collect the receivables for 2016? (Use 365 days in a year. Do not round intermediate calculations. Round your answers to the nearest whole number.)

c.

Assuming both companies use the percent of receivables allowance method, what is the estimated percentage of uncollectible accounts for each company? (Round your percentage answers to nearest whole number.)

The following information is available for Bergstrom Inc. and Sineann Inc. at December 31, 2016:

Explanation / Answer

a.

Net Accounts receivable = Accounts receiavble - Allowance for doubtful accounts

Accounts receivable turnover = Sales revenue / Net Accounts receivable

b.

Average days to collect the receivables for 2016 = 365 / Accounts receivable turnover

c.

Estimated percentage of uncollectible accounts for each year = Allowance for doubtful accounts / Accounts receivable

Bergstrom Sineann Accounts receivable 57,400 79,000 Allowance for doubtful accounts 2,648 2,356 Net Accounts receivable 54,752 76,644

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