Chapter $12$ Marketing, Sales, and Collections Processes

Borders USA is a retailer selling office$-$related supplies, furniture, and equipment. They have three sales channels: storefronts, an ordering website $($business$-$to$-$consumer$),$ and business$-$to$-$business $($B$2$B$)$ ordering. Purchases from storefront locations are paid immediately using cash or credit cards and customers receive their purchase immediately. Purchases from website orders are paid immediately using credit cards and their orders are delivered by mail. B$2$B orders are invoiced once the order is shipped. Borders USA recognizes revenue when the order has been delivered to the customer. You are an accountant at Borders USA and you have been asked to prepare metrics on sales, revenue, and accounts receivables. You extract the sales order data and accounts receivable data from the ERP system and create the following visualizations:

$1)$ Sales vs Revenue by Quarter in $2022$ This is a clustered bar chart showing sales totals and revenue totals by quarter. Hint: Revenue is recognized if the order has been delivered to the customer.

$2)$ Sales Total vs Sales Counts by Channel in $2022$ This is a clustered bar chart showing the quarterly sales totals by sales channels as a bar chart and the quarterly sales order counts as a line chart.

$3)$ Accounts Receivable Aging as of December $31,2022$ This is a bar chart showing the totals of outstanding accounts receivables that have not been paid. The age of the accounts receivable is based on the number of days between the delivery date and December $31,2022.$ The amounts are grouped by $31$ to $60$ days, $61$ to $90$ days, and greater than $90$ days. The outstanding accounts receivable amount is based on the sales total amount. The invoice date is the same as the delivery date.

$4)$ Sales Order Aging as of December $31,2022$ This is a bar chart showing the value of sales orders that have not been delivered. The age of outstanding sales orders is based on the number of days between the sales order date and December $31,2022.$ The amounts are grouped by $31$ to $60$ days, $61$ to $90$ days, and greater than $90$ days.

$5)$ Top $5$ Customers by Accounts Receivable Amount Due $$ This is a stacked bar chart showing the top $5$ customers that have the highest value of outstanding accounts receivables. The total values of outstanding accounts receivables are stacked by the age grouping.

$6)$ Top $5$ Customers by Outstanding Sales Order Amount $$ This is a stacked bar chart showing the top $5$ customers that have the highest value of outstanding sales orders. The total values of outstanding sales orders are stacked by the age grouping.

Please choose the best answer:

Multiple$-$Choice Questions $(5$ points$)$

$1.$ Using the Sales vs Revenue by Quarter in $2022$ visualization, what trends are being shown between sales and revenue?

a$.$ Sales was variable for each quarter, but revenue decreased every quarter.

b$.$ Sales decreased every quarter, but revenue was variable for each quarter.

c$.$ Revenue was higher than sales for each quarter.

d$.$ Revenue was lower than sales for only the first two quarters.

Answer: $.$

$2.$ Based on the results of the Sales Total vs Sales Order Counts by Channel in $2022$ visualization, how do the sales channels compare with each other?

a$.$ Website sales had the lowest number of sales orders, and the average value of the sales orders was lower compared to the other sales channels.

b$.$ B$2$B sales had the highest number of sales orders, and the average value of the sales orders was lower compared to the other sales channels.

c$.$ Storefront sales had the highest number of sales orders, and the average value of the sales orders was lower compared to the other sales channels.

d$.$ Storefront sales had the highest number of sales orders, and the average value of the sales orders was higher compared to the other sales channels.

Answer: $.$

$3.$ Based on the results of the Accounts Receivable Aging as of December $31,2022$ visualization, what conclusion can be made regarding the outstanding accounts receivables?

a$.$ The count of unpaid invoices was the highest for invoices within the $90+$ days aging group and the lowest for invoices in the $31-60$ days aging group.

b$.$ The count of unpaid invoices was the highest for invoices within the $31-60$ days aging group and the lowest for invoices in the $90+$ days aging group.

c$.$ The outstanding accounts receivable value for the $90+$ days aging group is approximately the value of the other aging groups combined.

d$.$ The outstanding accounts receivable value for the $90+$ days aging group is approximately twice the value of the other aging groups combined.

Answer: $.$

$4.$ Based on the results of the Sales Order Aging as of December $31,2022$ visualization, what conclusion can be made regarding the outstanding sales orders?

a$.$ The sales aging group with the highest value of outstanding sales orders is $90+$ days and the sales aging group with the low