Analyzing Accounts Receivable

Lupin Pharmaceuticals, an Indian transnational pharmaceutical company, develops and markets a wide portfolio of branded and generic products. The company reported the following in its 2018 annual report.

INR millions201820172016Trade receivables$52,229.0$43,391.8$45,946.3Less provision for doubtful receivables306.9318.4448.2Trade receivables, net$51,922.1$43,073.4$45,498.1Total assets$140,958$146,544$127,375Revenue from operations158,042174,943142,555

Required

a.Calculate days sale outstanding (DSO) for 2018 and 2017.

Note:Round amount (your final answer) to one decimal place (for example, enter 6.8 for 6.77555).

DSO for 2018: ?

daysDSO for 2017?

days

b. Determine the total amount that customers owe Lupin each year.

Note:Round dollar amount (your final answer) to one decimal place (for example, enter 6.8 for 6.77555).

Amount owed in 2018Answer

Amount owed in 2017Answer

Amount owed in 2016Answer

c.What proportion of trade receivables is doubtful each year?

Note:Round percentage (your final answer) to two decimal places (for example, enter 0.66% for 0.6555%).

2018: Proportion of AR that is doubtfulAnswer

2017: Proportion of AR that is doubtfulAnswer

2016: Proportion of AR that is doubtfulAnswer

d. From this ratio, what do we conclude about the quality of its trade receivables over time?

We can conclude that the quality of receivables hasAnswer

increased

decreased

remained flat

over time.

Please answer all parts of the question.