E5-47B. (Learning Objective 5: Analyzing a company’s financial statements) Contemporary Limited, the electronics and appliance chain, reported these figures in millions of dollars:

Requirements 1. Compute Contemporary’s average collection period during 20X7.
2. Is Contemporary’s collection period long or short? Kurzwel Networks takes 40 days to collect its average level of receivables. Damascus, the overnight shipper, takes 25 days. What causes Contemporary’s collection period to be so different?

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20X7 20X6 Net sales... 574,000 603,000 Receivables at end of year. 3,670 4,380