Powers Company reported Net sales of $1,200,000 and Accounts Receivable,net of $78,500.The Day's sales uncollected (rounded to whole days)is:
A)24 days.
B)15 days.
C)4 days.
D)56 days.
E)48 days.

Question

Quizplus · Accepted Answer

Day's sales uncollected is calculated as (Accounts Receivable / Net Sales) * 365. For Powers Company, it is ($78,500 / $1,200,000) * 365 = 23.86, which rounds to 24 days.

Powers Company Reported Net Sales of $1,200,000 and Accounts Receivable,net