Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

The Tabor Sales Company had a gross profit margin (gross profits divided by sales) of 30.7 percent and sales of $9.4 million last year. Seventy-five

The Tabor Sales Company had a gross profit margin (gross profits divided by sales) of 30.7 percent and sales of $9.4 million last year. Seventy-five percent of the firm's sales are on credit and the remainder are cash sales. Tabor's current assets equal $2.7 million, its current liabilities equal $283000 , and it has $98000 in cash plus marketable securities.

a. If Tabor's accounts receivable are $562500 , what is its average collection period?

b. If Tabor reduces its average collection period to 24 days, what will be its new level of accounts receivable?

c. Tabor's inventory turnover ratio is 9.5 times. What is the level of Tabor's inventories?

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Cost Accounting Fundamentals Essential Concepts And Examples

Authors: Steven M. Bragg

6th Edition

1642210234, 9781642210231

More Books

Students also viewed these Accounting questions

Question

Explain the relationship between language and culture

Answered: 1 week ago

Question

Compare and contrast elaborated and restricted codes

Answered: 1 week ago