Refer to Polaris financial statements in Appendix A to answer the following. 1. What is the amount

Question:

Refer to Polaris’ financial statements in Appendix A to answer the following.

1. What is the amount of Polaris’ accounts receivable as of December 31, 2011?

2. Compute Polaris’ accounts receivable turnover as of December 31, 2011.

3. How long does it take, on average, for the company to collect receivables? Do you believe that customers actually pay the amounts due within this short period? Explain.

4. Polaris’ most liquid assets include (a) cash and cash equivalents, (b) receivables, and (c) inventory. Compute the percentage that these liquid assets make up of current liabilities as of December 31, 2011. Do the same computations for December 31, 2010. Comment on the company’s ability to satisfy its cur-rent liabilities as of its 2011 year- end compared to its 2010 year- end.

5. What criteria did Polaris use to classify items as cash equivalents?

Financial Statements
Financial 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...