The following information was obtained from the 2016 and 2015 financial statements Better Books and Tenacious Texts. Assume all sales are on credit for both companies.
REQUIRED:
1. Using the information provided, compute the following for each company for 2016rounded to two decimals:
a. Accounts receivable turnover ratio
b. Number of days' sales in receivables
c. Inventory turnover ratio
d. Number of days' sales in inventory
e. Cash-to-cash operating cycle
2. Comment briefly on the liquidity of each of these two companies.

Question

The following information was obtained from the 2016 and 2015 financial statements Better Books and Tenacious Texts. Assume all sales are on credit for both companies.
  REQUIRED:
1. Using the information provided, compute the following for each company for 2016rounded to two decimals:
a. Accounts receivable turnover ratio
b. Number of days' sales in receivables
c. Inventory turnover ratio
d. Number of days' sales in inventory
e. Cash-to-cash operating cycle
2. Comment briefly on the liquidity of each of these two companies.

Quizplus · Accepted Answer

The Answer of The following information was obtained from the 2016 and 2015 financial statements Better Books and Tenacious Texts. Assume all sales are on credit for both companies.
  REQUIRED:
1. Using the information provided, compute the following for each company for 2016rounded to two decimals:
a. Accounts receivable turnover ratio
b. Number of days' sales in receivables
c. Inventory turnover ratio
d. Number of days' sales in inventory
e. Cash-to-cash operating cycle
2. Comment briefly on the liquidity of each of these two companies.

The Following Information Was Obtained from the 2016 and 2015