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Question 4 ABC Corporation sells its products to diverse customer base. During the year, the company had total credit sales of $5,000,000. The companys average
Question 4 ABC Corporation sells its products to diverse customer base. During the year, the company had total credit sales of $5,000,000. The companys average accounts receivable balance was $800,000. The companys credit terms allow customers 45 days to pay their invoices. Calculate the average collection period in days and assess the companys efficiency in managing its accounts receivable.
Question 4
ABC Corporation sells its products to diverse customer base. During the year, the company had total credit
sales of $5,000,000. The companys average accounts receivable balance was $800,000. The companys
credit terms allow customers 45 days to pay their invoices. Calculate the average collection period in days
and assess the companys efficiency in managing its accounts receivable.
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Advanced Accounting
Authors: Joe Hoyle, Thomas Schaefer, Timothy Doupnik
10th edition
0-07-794127-6, 978-0-07-79412, 978-0077431808
