The following information is taken from the 2006 financial statements and accompanying notes of The Scotts Miracle-Gro Company, a manufacturer of lawn-care products.

The Scotts Miracle-Gro Company

Note 17. Concentrations of Credit Risk (partial)
Financial Instruments which potentially subject the Company to concentration of credit risk consist principally of trade accounts receivable. The company sells its consumer products to a wide variety |of retailers, including mass merchandisers, home centers, independent hardware stores, nurseries, garden outlets, warehouse clubs and local and regional chains. Professional products are sold to commercial nurseries, greenhouses, landscape services, and growers of specialty agriculture crops. At September 30, 2006, 76% of the Company's accounts receivable were due from customers geographically located in North America. Approximately 79% of these receivables were generated from
the consumer business with the remaining 21% due from customers of Scotts LawnServiceR, the professional businesses (primarily distributors), Smith & HawkenR, and Morning SongR. Our top 3 customers within the consumer business accounted for 53% of total consumer accounts receivable.
The remainder of the Company's accounts receivable at September 30, 2006 were generated from customers located outside of North America, primarily retailers, distributors, nurseries and growers in Europe. No concentrations of customers or individual customers within this group account for more than 10% of the Company's accounts receivable at either balance sheet date.
The Company's three largest customers accounted for the following percentage of net sales in each respective period:

Sales to the Company's three largest customers are reported within the Company's North America segment. No other customers accounted for more than 10% of fiscal 2006, fiscal 2005 or fiscal 2004 net sales.

Instructions
Answer each of the following questions.
(a) Calculate the accounts receivable turnover ratio and average collection period for 2006 for the company.
(b) Is accounts receivable a material component of the company's total current assets?
(c) Scotts sells seasonal products. How might this affect the accuracy of your answer to part (a)?
(d) Evaluate the credit risk of Scotts' concentrated receivables.
(e) Comment on the informational value of Scotts' Note 17 on concentrations of credit risk.

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in millions) Accounts receivable Allowance for uncollectible accounts Sales Total current assets 2006 $391.7 2,697.1 2005 $334.7 2,369.3 11.3 11.4 942.0 787.8 3rd-Largest Customer 10.5% 9.7% 9.4% Largest Customer 2006 2005 2004 21.5% 23.5% 25.0% 2nd-Largest Customer 11.2% 11.9% 12.9%