Aguilera Corp. has a current accounts receivable balance of $333,000. Credit sal
ID: 2649270 • Letter: A
Question
Aguilera Corp. has a current accounts receivable balance of $333,000. Credit sales for the year just ended were $4,015,980.
What is the company's receivables turnover?
What is the company's days' sales in receivables?
How long did it take on average for credit customers to pay off their accounts during the past year?
Aguilera Corp. has a current accounts receivable balance of $333,000. Credit sales for the year just ended were $4,015,980.
What is the company's receivables turnover?
What is the company's days' sales in receivables?
How long did it take on average for credit customers to pay off their accounts during the past year?
Explanation / Answer
Answer:
Receivables turnover = Net credit sales / Average Accounts receivable
= $4,015,980 / $333,000
= 12.06 times
Days' sales in receivables = 365 days / Receivables turnover
= 365 /12.06 = 30.26 days
It took on average 30.26 days for credit customers to pay off their accounts during the past year
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