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Hall Corporation and Harris Bears are two of the largest and most successful toymakers in the world, in terms of the products they sell and

Hall Corporation and Harris Bears are two of the largest and most successful toymakers in the world, in terms of the products they sell and their receivables management practices. To evaluate their ability to collect on credit sales, consider the following information reported in their annual reports (amounts in millions).

Fiscal Year Ended: Hall Harris
2018 2017 2016 2018 2017 2016
Net Sales $ 5,056 $ 4,531 $ 5,118 $ 3,202 $ 3,068 $ 3,222
Accounts Receivable 1,128 734 860 952 1,032 604
Allowance for Doubtful Accounts 18 21 22 27 29 28
Accounts Receivable, Net of Allowance 1,110 713 838 925 1,003 576

Required:

  1. 1. Calculate the receivables turnover ratios and days to collect for Hall and Harris for 2018 and 2017. TIP: In your calculations, use average Accounts Receivable, Net of Allowance.

  2. 2-a. Which of the companies was quicker to convert its receivables into cash in 2018?

  3. 2-b. Which of the companies was quicker to convert its receivables into cash in 2017?

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2018 2017
Hall Harris Hall Harris
Receivables Turnover Ratio
Days to Collect

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