The financial statements included in the 2014 Form 10-K of Nike reported the following amounts (in millions of dollars):
Revenues, for the year ended May 31, 2014 ................... $27,799
Accounts receivable, net, May 31, 2014 ......................... 3,343
Accounts receivable, net, May 31, 2013 ......................... 3,117
Required
1. Compute Nike's accounts receivable turnover ratio for the year ended May 31, 2014. (Assume that all sales are on credit.)
2. What is the average collection period in days for an account receivable? Explain your answer.
3. Give some examples of the types of customers you would expect Nike to have. Do you think the average collection period for sales to these customers is reasonable? What other information do you need to fully answer that question?