Refer to Best Buys financial statements in Appendix A to answer the following. 1. What is the
Question:
Refer to Best Buy’s financial statements in Appendix A to answer the following.
1. What is the amount of Best Buy’s accounts receivable as of February 28, 2009?
2. Compute Best Buy’s accounts receivable turnover as of February 28, 2009.
3. How long does it take, on average, for Best Buy to collect receivables? Why is this period so short?
Do you believe that customers actually pay the amounts due within this short period? Explain.
4. Best Buy’s most liquid assets include (a) cash and cash equivalents, (b) short-term investments, and (c) receivables. Compute the percentage that these liquid assets make up of current liabilities as of February 28, 2009. Do the same computations for March 1, 2008. Comment on the company’s ability to satisfy its current liabilities as of its 2009 fiscal year-end compared to its 2008 fiscal year-end.
5. What criteria did Best Buy use to classify items as cash equivalents?
Financial StatementsFinancial statements are the standardized formats to present the financial information related to a business or an organization for its users. Financial statements contain the historical information as well as current period’s financial... Accounts Receivable
Accounts receivables are debts owed to your company, usually from sales on credit. Accounts receivable is business asset, the sum of the money owed to you by customers who haven’t paid.The standard procedure in business-to-business sales is that...
Step by Step Answer:
1 Best Buys receivables at February 28 2009 are 1868 million 2 Accounts receivable turnover for fisc...View the full answer
