Based on the following data for the current year, determine the number of days' sales in accounts receivable? $\begin{array}{cl}
\$ 1,095,000 & \text { Net sales on account during the year } \
700,000 & \text { Cost of merchandise sold during the yeat } \
47,500 & \text { Accounts receivable, be ginning of year } \
37,500 & \text { Accounts receivable, end of year } \
190,000 & \text { Inventory, be ginning of year } \
220,000 & \text { Inventory, end of year }
\end{array}$

A) 12.5
B) 14.17
C) 25.76
D) 15.8

Question

Based on the following data for the current year, determine the number of days' sales in accounts receivable? $\begin{array}{cl}
\$ 1,095,000 & \text { Net sales on account during the year } \
700,000 & \text { Cost of merchandise sold during the yeat } \
47,500 & \text { Accounts receivable, be ginning of year } \
37,500 & \text { Accounts receivable, end of year } \
190,000 & \text { Inventory, be ginning of year } \
220,000 & \text { Inventory, end of year }
\end{array}$

A) 12.5
B) 14.17
C) 25.76
D) 15.8

Quizplus · Accepted Answer

The average accounts receivable is $(47,500 + 37,500) / 2 = 42,500$. The accounts receivable turnover is $1,095,000 / 42,500 = 25.76$. The number of days' sales in accounts receivable is $365 / 25.76 = 14.17$.

Based on the Following Data for the Current Year, Determine