Question
Route Canal Shipping Company has the following schedule for aging of accounts receivable: Age of Receivables April 30, 20X1 (1) (2) (3) (4) Month of
Route Canal Shipping Company has the following schedule for aging of accounts receivable: Age of Receivables April 30, 20X1 (1) (2) (3) (4) Month of Sales Age of Account Amounts Percent of Amount Due April 030 $ 282,240 _______ March 3160 105,840 _______ February 6190 246,960 _______ January 91120 70,560 _______ Total receivables $ 705,600 100% a. Calculate the percentage of amount due for each month.
b. If the firm had $1,728,000 in credit sales over the four-month period, compute the average collection period. Average daily credit sales should be based on a 120-day period.
c. If the firm likes to see its bills collected in 48 days, should it be satisfied with the average collection period? multiple choice 1 No Yes
d. Disregarding your answer to part c and considering the aging schedule for accounts receivable, should the company be satisfied? multiple choice 2 Yes No
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