The following account balances are taken from the records of the Faraway Travel Agency: Faraway extends credit
Question:
Faraway extends credit terms requiring full payment in 60 days, with no discount for early payment.
Required
1. Compute Faraways accounts receivable turnover ratio for 2010 and 2009.
2. Compute the number of days sales in receivables for 2010 and 2009. Assume 360 days in a year.
3. Comment on the efficiency of Faraways collection efforts over the two-yearperiod.
Transcribed Image Text:
2010 $150,000 2010 December 31 2009 $100,000 2009 2008 Accounts receivable Net credit sales $600,000 $540,000
Fantastic news! We've Found the answer you've been seeking!
Step by Step Answer:
Answer rating: 53% (15 reviews)
1 Accounts receivable turnover Net credit salesAverage accounts receivable 2010 6000001...View the full answer
Answered By
Nyron Beeput
I am an active educator and professional tutor with substantial experience in Biology and General Science. The past two years I have been tutoring online intensively with high school and college students. I have been teaching for four years and this experience has helped me to hone skills such as patience, dedication and flexibility. I work at the pace of my students and ensure that they understand.
My method of using real life examples that my students can relate to has helped them grasp concepts more readily. I also help students learn how to apply their knowledge and they appreciate that very much.
4.00+
1+ Reviews
10+ Question Solved
Related Book For
Using Financial Accounting Information The Alternative to Debits and Credits
ISBN: 978-1133161646
7th Edition
Authors: Gary A. Porter, Curtis L. Norton
Question Posted:
Students also viewed these Accounting questions
-
The following account balances are taken from the records of Lewis Inc., a wholesaler of fresh fruits and vegetables: Required 1. Compute Lewiss inventory turnover ratio for 2010 and 2009. 2. Compute...
-
The following account balances are taken from the records of Monets Garden Inc.: Current liabilities ........... $150,000 Long-term liabilities ......... 375,000 Stockholders equity ......... 400,000...
-
The following account balances are taken from the records of Lewis Inc., a wholesaler of fresh fruits and vegetables: Required 1. Compute Lewiss inventory turnover ratio for 2010 and 2009. 2. Compute...
-
If the interest rate on debt is lower than ROA, then a firm will Valitse yksi: a. increase ROE b. not change ROE c. none of these is correct d. decrease ROE e. change the ROE in an indeterminable...
-
The net income per books of Russell Industries Limited was determined without any knowledge of the following errors. The 2012 year was Russell's first year in business. No dividends have been...
-
Solve this matrix equation. 844 132 201
-
Referring to the information in Brief Exercise 17-44, and assuming that the building has a fair value of \(\$ 2,000,000\) at the commencement of the lease, what amount would Property Inc. recognize...
-
As of January 1, 2012, the trial balance for Haven Hospital was as follows: During the fiscal year ended December 31, 2012, the following transactions occurred: 1. Patient service revenue amounted to...
-
Second are service contracts that extend over two years to operate the wind farm. You may assume that those contracts are all paid in advance and services are provided in accordance with the...
-
The 2018 balance sheets and income statement for Netflix Inc. follow. Refer to these financial statements to answer the requirements. NETFLIX INC. Consolidated Statement of Earnings For Year Ended...
-
Fill in the blank to indicate the line item that would appear on the income statement for each of the following events. Item on Income Statement Event ____________________ Disposed of a segment of...
-
The following information was obtained from the 2008 and 2007 financial statements of Coca-Cola Company and Subsidiaries and PepsiCo Inc. and Subsidiaries. (Yearends for PepsiCo are December 27,...
-
Explain how Factor Analysis of Information Risk (FAIR) can help organizations understand, analyze, and measure information risk. Discuss the four major stages of the FAIR methodology, which consist...
-
CHALLENGE ACTIVITY 5.2.2: Format temperature output. Print air_temperature with 1 decimal point followed by C. Sample output with input: 36.4158102 36 . 4C Code writing challenge activity demo...
-
You have been provided with the following information for Division X of a decentralized company: Selling price $ 95 Variable cost per unit 65 Fixed cost per unit 28 Sales volume (units) 22,900...
-
Jeffrey Pfeffer (1998b) wrote in his article on Six dangerous myths about pay in the Harvard Business Review: People do work for money but they work even more for meaning in their lives. In fact,...
-
Complete the Python program to include a function named print_random_letter, which will take a string as a parameter, and then randomly choose a character from that string and print the letter and...
-
5. Otylia Manufacturing Company assembles its product in several departments. It has two departments that process all units. During February, the beginning work in process in the cutting department...
-
On 1 July 2025 Roxanne and Asterios formed a partnership with initial capital balances of \($280\)000 and \($310\)000 respectively. The Profit or Loss Summary account for the year ended 30 June 2026...
-
Don Griffin worked as an accountant at a local accounting firm for five years after graduating from university. Recently, he opened his own accounting practice, which he operates as a corporation....
-
(a) Describe three ways in which you could increase the internal energy of an open system. (b) Which of these methods could you use to increase the internal energy of a closed system? (c) Which, if...
-
Green Bay Corporation began business in July 2012 as a commercial fishing operation and a passenger service between islands. Shares of stock were issued to the owners in exchange for cash. Boats were...
-
Hometown Cleaners Inc. operates a small dry-cleaning business. The company has always maintained a complete and accurate set of records. Unfortunately, the company's accountant left in a dispute with...
-
The Coca-Cola Company and Subsidiaries reported the following amounts in various statements included in its 2010 annual report. (All amounts are stated in millions of dollars.) Net income for...
-
Find the k-best (i.e. largest) values in a set of data. Assume you are given a sequence of values, one value at a time. We do not know how many elements there are in this sequence. In fact, there...
-
Present Value Index When funds for capital investments are limited, projects can be ranked using a present value index. A project with a negative net present value will have a present value index...
-
can you compute and explain?. Sheridan, lnc. is considering purchasing equipment costing $37000 with a 7-year useful life. The equipment will provide cost savings of $7600 and will be depreciated...
Study smarter with the SolutionInn App