Question

A firm sells $300 million worth of goods per year, and the average balance in accounts receivable is $75 million. (Accounts receivable is when the firm sells an item, but hasn't collect the payment yet). How long does it take for the firm to collect an accounts receivable dollar, on average? 

          A firm sells $300 million worth of goods per year, and the average balance in accounts receivable is $75 million. (Accounts receivable is when the firm sells an item, but hasn't collect the payment yet). How long does it take for the firm to collect an accounts receivable dollar, on average?
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Horngren’s Cost Accounting
Horngren’s Cost Accounting
Srikant M. Datar, Madhav V. Rajan 16th Edition
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A firm sells $300 million worth of goods per year, and the average balance in accounts receivable is $75 million. (Accounts receivable is when the firm sells an item, but hasn't collect the payment yet). How long does it take for the firm to collect an accounts receivable dollar, on average?
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Transcript

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00:01 Here in this problem i can use the formula total asset turn over ratio is equal to sales by sales by assets so in the next step i can write the value of sales is equal to sales is equal to 1 .40 multiplication 211800 which is equal to 296 5 to0 dollar now i can write account receivable account receivable turn over turn over ratio is equal to turn over ratio is equal to sales by account receival which is equal to 296 5 to 0 by 42900 which is equal to 6 .9119...
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