. Vanity Press, Inc., has annual credit sales of $1.6 million and a gross profit margin

of 35 percent.

%u2022a. If the firm wishes to maintain an average collection period of 50 days, what

level of accounts receivable should it carry? (Assume a 365-day year.)

b. The inventory turnover for this industry averages six times. If all of Vanity%u2019s

sales are on credit, what average level of inventory should the firm maintain

to achieve the same inventory turnover figure as the industry?