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The company's income statements for the current year and one year ago follow. Assume that all sales are on credit: For Year Ended December
The company's income statements for the current year and one year ago follow. Assume that all sales are on credit: For Year Ended December 31 Sales Cost of goods sold Other operating expenses Interest expense Income tax expense Total costs and expenses Net income Earnings per share (1-a) Compute days' sales uncollected. Current Year 1 Year Ago $ 673,500. $ 532,000 $ 411,225 209,550 $ 345,500 12,100 9,525 $ 31,100 134,980 13,300 8,845 642,400 $ 1.90 (1-b) Determine if days' sales uncollected improved or worsened in the current year. (2-a) Compute accounts receivable turnover. 502,625 $ 29,375 $ 1.80 (2-b) Determine if accounts receivable turnover ratio improved or worsened in the current year. (3-a) Compute inventory turnover. (3-b) Determine if inventory turnover ratio improved or worsened in the current year. (4-a) Compute days' sales in inventory. (4-b) For each ratio, determine if days' sales in inventory improved or worsened in the current year.
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