Rise Above This, Inc., has an average collection period of 46 days. Its average

Question

Rise Above This, Inc., has an average collection period of 46 days. Its average daily investment in receivables is $67,800. Assume 365 days per year.

What is the receivables turnover? (Round your answer to 4 decimal places. (e.g., 32.1616))

What are annual credit sales? (Do not round intermediate calculations and round your final answer to 2 decimal places. (e.g., 32.16))

Rise Above This, Inc., has an average collection period of 46 days. Its average daily investment in receivables is $67,800. Assume 365 days per year.

Explanation / Answer

avg collection period= (Days*AR)/Credit sales

credit sales= (365*67800)/46= 537978

Receivable turnover= 537978/67800= 7.9348 times

Annual credit sales =537978

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