Essence of Skunk Fragrances, Ltd., sells 7,400 units of its perfume collection e

Question

Essence of Skunk Fragrances, Ltd., sells 7,400 units of its perfume collection each year at a price per unit of $690. All sales are on credit with terms of 1/15, net 60. The discount is taken by 55 percent of the customers.

Calculate the average collection period. (Round your answer to 2 decimal places. (e.g., 32.16))

What is the receivables turnover? (Use 365 days a year. Do not round intermediate calculations and round your final answer to 3 decimal places. (e.g., 32.161))

What is the amount of the companys average receivable? (Do not round intermediate calculations and round your final answer to 2 decimal places. (e.g., 32.16))

Essence of Skunk Fragrances, Ltd., sells 7,400 units of its perfume collection each year at a price per unit of $690. All sales are on credit with terms of 1/15, net 60. The discount is taken by 55 percent of the customers.

Explanation / Answer

c. Average receivables ($)? Do not round intermediate calculations and round your final answer to 2 decimal places.

Average receivables = Sales/365 * Avg Collecton Period = 2,280,000/365 *  44.82  = $ 279971.50

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