Question
please show me your solution
Page Leout Relerences Malings Review iew ignated fron an Intemet location and might be uncafe. Cick for moce detailts Enable Edting ACCOUNTS RECEIVABLE MANAGEMENT Marv's Women's Wear has the following schedule for aging of accounts receivable Age of Receivables, April 30, 2004 13) 0) Month of Sales 2) Age of Account Percent of Amounts mount Due Apeil March Febeuary anuary 0-30 31-60 61-90 91-120 $ 88,000 44,000 3,000 Total receivables $200,000 10096 a Fill in column (4) for each month b. Ifthe fim had $960,000 in credit sales over the four-month period, compute the avenge collection period Aveage daily sales should be based c. Ifthe fim ikes to see its bills collected in 30 days, should it be satisfied d. Disregarding your answer to part c and considering the aging schedule fo e Whas additional isfoemation does the aging schedule bring to the coepany on a 120-day period with the avesage collection period? accounts receivable, should the company be satisfied? that the average collection pesiod may not show?
Explanation / Answer
a)Percent of amount due for April=88000/200000=44%
For March, 44000/200000=22%
For February,33000/200000=16.5%
For January,55000/200000=27.5%
b)Average collection period=120×100000/960000=12.5 days.
c)Yes it is satisfied.
Thank you.
