TEW COMPANY Balance Sheet As of December 31 ASSETS Cash 20,000 Accounts receivable 80,000 Inventory 50,000 Net plant and equipment 250,000 Total assets 400,000 LIABILITIES AND STOCKHOLDERS' EQUITY Accounts payable 40,000 Accrued expenses 60,000 Long-term debt 130,000 Common stock 100,000 Paid-in capital 10,000 Retained earnings 60,000 Total liabilities and 400,000 stockholders' equity TEW COMPANY Income Statement For the year ended December 31 Sales (all on credit) $ 500,000 Cost of goods sold 200,000 Gross profit $ 300,000 Sales and administrative 20,000 expenses Fixed lease expenses 10,000 Depreciation 40,000 Operating profit 230,000 Interest expense 20,000 Profit before taxes 210,000 Taxes (35%) 73,500 Net income 136,500 Refer to the tables above. The firm's average collection period is (assume a 360-day calendar). 6.3 days 57.6 days. 55.6 days. 222 days