5. Practice Problem 15-3

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Axis Wells and Excavation (AWE) currently generates $60,000 in annual credit sales. AWE sells on terms of net 50, and its accounts receivable balance averages $12,000. AWE is considering a new credit policy with terms of net 25. Under the new policy, sales will decrease to $41,400, and accounts receivable will average $13,800. Compute the days sales outstanding (DSO) under the existing policy and the proposed policy. Assume there are 360 days in a year. Round your answers to the nearest whole number.

DSO_Existing: days

DSO_New: days