C8-2 Evaluating Accounts Receivable Management (Chapters 6 and 8) (LO 6-4, 8-4) WorldBiz operates divisions around the world. Its European division-EuroBiz (EB)-has recently reported the following information to you at WorldBiz's head office. You are trying to decide whether to direct your internal audit staff to investigate more closely. From the Financial Statement Not Accounts Receivable (gross) Allowance for Doubtful Accounts Accounts Receivable, Net Year 5 $104,000 (5,200). 98,800 Year 4 $64,000 (6,400) 57,600 Year 3 $44,000 (4.400) 39, 600|||| Other Information Cathered Net Sales Revenue Accounts Receivable Write-offs Bad Debt Expense Sales Discounts (2/10, n/30) $650,000 7.300 6.500 $605,000 6,500 9,075 9.400 $530,000 6,500 7.950 5.400 3.400 Required: 1-a. For each of the years, calculate the proportion of gross accounts receivable estimated to be uncollectible as allowed for in the Allowance for Doubtful Accounts. 1-b. Which year does not align with the other two? 2-a. For each of the years, calculate the proportion of Net Sales Revenue that Bad Debt Expense represents. 2-b. Which year does not align with the other two? 3-a. Did customers take greater (or lesser) advantage of sales discounts in Year 5 than in Year 4 and Year 3? 3-b. Does this indicate customers were more (or less) likely to promptly pay their balances in Year 5 as compared to prior years? 4-a. Calculate the average days to collect in Year 5 and Year 4. 4-b. Does this measure indicate customers paid their balances faster (or slower) in Year 5 as compared to Year 47 5-a. Indicate (yes or no) whether you should direct your internal audit staff to investigate EB's receivables management practices more closely