Polo Raiph Lauren Corporation designs, markets, and distributes a variety of apparel, home decor, accessory, and fragrance products. The company's products include such brands as Polo by Ralph Lauren, Ralph Lauren Purple Label, Ralph Lauren, Polo Jeans Co., and Chaps. Polo Ralph Lauren reported the following (in thousands):

Assume that accounts receivable (in thousands) were \(\$ 391,558\) at the beginning of the 2004 fiscal year.

a. Compute the accounts receivable turnover for 2005 and 2004. Round to one decimal place.

b. Compute the days' sales in receivables for 2005 and 2004. Round to one decimal place.

c. What conclusions can be drawn from these analyses regarding Ralph Lauren's efficiency in collecting receivables?

Transcribed Image Text:

Net sales Accounts receivable For the Period Ending April 2, 2005 $3,305,415 530,503 April 3, 2004 $2,649,654 463,289