1. Drake Paper Company sells on terms of net 30. The firms variable cost ratio is 0.90. Assume there are 365 days per year. Round your answers to the nearest dollar. Enter your answers in whole dollars. For example, an answer of $1.20 million should be entered as 1,200,000, not 1.20.

1. If annual credit sales are $22 million and its accounts receivable average 13 days overdue, what is Drakes investment in receivables?

   $

2. Suppose that, as the result of a recession, annual credit sales decline by 30 percent to $15.4 million, and customers delay their payments to an average of 26 days past the due date. What will be Drakes new level of receivables investment?

   $

2. Miranda Tool Company sells to retail hardware stores on credit terms of net 30. Annual credit sales are $23 million and are spread evenly throughout the year. The companys variable cost ratio is 0.60, and its accounts receivable average $1.5 million. Assume there are 365 days per year. Using this information, determine the following for the company:

1. Average daily credit sales. Round your answer to the nearest dollar. Enter your answer in whole dollars. For example, an answer of $1.2 million should be entered as 1,200,000, not 1.20.

   $

2. Average collection period. Round your answer to one decimal place.

   days

3. Average investment in receivables. Round your answer to the nearest dollar. Enter your answer in whole dollars. For example, an answer of $1.2 million should be entered as 1,200,000, not 1.20.

   $