Question
WorldBiz operates divisions around the world. Its European divisionEuroBiz (EB)has recently reported the following information to you at WorldBizs head office. You are trying to
WorldBiz operates divisions around the world. Its European divisionEuroBiz (EB)has recently reported the following information to you at WorldBizs head office. You are trying to decide whether to direct your internal audit staff to investigate more closely. From the Financial Statement Notes 2015 2014 2013 Accounts Receivable (gross) $ 105,000 $ 65,000 $ 45,000 Allowance for Doubtful Accounts (6,300 ) (7,800 ) (5,400 ) Accounts Receivable, Net 98,700 57,200 39,600 Other Information Gathered Net Sales Revenue $ 655,000 $ 605,000 $ 540,000 Accounts Receivable Write-offs 14,600 12,725 6,600 Bad Debt Expense 13,100 15,125 13,500 Sales Discounts (3/10, n/30) 3,500 9,500 5,500 Required: 1-a. For each of the years, calculate the proportion of gross accounts receivables estimated to be uncollectible as allowed for in the Allowance for Doubtful Accounts. (Round your answers to 1 decimal place.) 2-a. For each of the years, calculate the proportion of Net Sales Revenue that Bad Debt Expense represents. (Round your answers to 1 decimal place.) 4-a. Calculate the average days to collect in 2015 and 2014. (Use 365 days in a year. Round your answers to 1 decimal place.)
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