average collection period for receivables

156 Chapter 4 Analyzing and Interpreting Financial Statements 4.4 The following data have been selected from the annu al report of Graphic Chips Limited. Sales (80% on credit) EBIT Accounts receivable Common shares ($000) 2,550 250 400 1,200 Cost of goods sold Net income Long-term debt Retained earnings ($000) 1,750 140 300 800 Required: Calculate the following ratios: (a) Gross profit margin (b) Operating profit margin (c) Sales revenue to capital employed (d) Leverage ratio (e) Average collection period for receivables