CP $9-6$ Accounts receivable turnover and days' sales in receivables

Best Buy is a specialty retailer of consumer electronics, including personal computers,

entertainment software, and appliances. Best Buy operates retail stores in addition to the

Best Buy, Media Play, On Cue, and Magnolia Hi$-$Fi websites. For two recent years, Best Buy

reported the following $($in millions$)$:

Assume that the accounts receivable $($in millions$)$ were $$1,347$ at the beginning of

fiscal Year $1.$

Compute the accounts receivable turnover for Year $2$ and Year $1.$ Round to two decimal

places.

Compute the days' sales in receivables at the end of Year $2$ and Year $1.$ Use $365$ days

and round to one decimal place.

What conclusions can be drawn from $(1)$ and $(2)$ regarding Best Buy's

efficiency in collecting receivables?

What assumption did we make about sales for the Best Buy ratio computa$-$

tions that might distort the ratios and therefore cause the ratios not to be comparable

for Year $2$ and Year $1?$