Accounts Receivable Turnover and Days' Sales in Receivables

Quasar, Inc. sells clothing, accessories, and personal care products for men and women through its retail stores. Quasar reported the following data for two recent years:

	Year 2		Year 1
Sales	$1,091,350		$1,074,195
Accounts receivable	98,550		91,250

Assume that accounts receivable were $105,850 at the beginning of Year 1.

a. Compute the accounts receivable turnover for Year 2 and Year 1. Round to one decimal place.

Year 2:
Year 1:

b. Compute the days' sales in receivables for Year 2 and Year 1. Round interim calculations and final answers to one decimal place. Use 365 days per year in your calculations.

Year 2:	days
Year 1:	days

c. The change in accounts receivable turnover from year 1 to year 2 indicates a(n) increase in the efficiency of collecting accounts receivable and is a(n) favorable change. The change in the days' sales in receivables indicates a(n) favorable change.