According to some estimates, the volume of electronic commerce transactions exceeds $3 trillion. Business-to-business transactions account for almost half of this amount. What changes do you believe are in store formanagerial accounting as a result of the explosion in e-commerce?
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According to some estimates, the volume of electronic commerce transactions exceeds $3 trillion. Business-to-business transactions account for almost half of this amount. What changes do you believe are in store for
managerial accounting as a result of the explosion in e-commerce?
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- Marbel had $4,448 million in sales and $1,218 million in ending accounts receivable for the current period. For the same period, Maxtel reported $5,703 million in sales and $1,145 million in ending accounts receivable. Calculate the days’ sales uncollected for both companies as of the end of the current period. Marbel Maxtel Which company is doing a better job in managing the collection of its receivables?Saturn Computer is considering to expand, but before that, the management wants to know the financial position of the company compared to that of the industry. Data for Saturn Computer Co. and its industry averages follow. Items Amount ($) Items Amounts ($) Cash 87,500 Accounts Payable 110,000 Total Operating Expense 123,000 Interest Expense 26,500 Income Tax 18,200 Total Sales 1,607,500 Net Fixed Assets 292,500 Long-term Bank Loan 246,500 Cost of Goods Sold 1,352,500 Common Stock Equity 361,000 Inventories 211,500 Other Current Liabilities 84,000 Accounts Receivables 336,000 Notes Payable (Maturity within 1 year) 107,000 Total Operating Profit 110,000 Net Profit after tax 88,300…18. Calapan Company provided the data in the table below. In 2011, accounts written off amounted to P100,000. Sales returns with credit memo amounted to P150,000 and purchase returns, P50,000. Cash receipts from customers after P200,000 discounts totaled P6,000,000, while cash payments to trade creditors amounted to P4,000,000 after discounts of P300,000. Cash paid to customers for goods returned was P50,000. On this transaction, accounts receivable was debited. Under accrual basis, what amount should be reported as gross purchases for the current year? a. 4,700,000 b. 4,350,000 c. 4,300,000 d. 4,000,000
- IBM had net sales of $81,741 and average accounts receivable of $8,712. Its competitor, Oracle, had net sales of $38,226 and average accounts receivables of $5,618. Calculate the accounts receivable turnover for both companies. IBM: Oracle: Which company is doing a better job of managing its accounts receivables?Cola Inc. and Soda Co. are two of the largest and most successful beverage companies in the world in terms of the products that they sell and their receivables management practices. To evaluate their ability to collect on credit sales, consider the following rounded amounts reported in their annual reports (amounts in millions). Cola Inc. Soda Co. Fiscal Year Ended: 2015 2014 2013 2015 2014 2013 Net Sales $ 31,219 $ 26,690 $ 27,944 $ 53,448 $ 39,232 $ 39,251 Accounts Receivable 4,398 3,733 3,061 6,387 4,634 3,704 Allowance for Doubtful Accounts 40 47 43 136 82 62 Accounts Receivable, Net of Allowance 4,358 3,686 3,018 6,251 4,552 3,642 Required: Calculate the receivables turnover ratios and days to collect for Cola Inc. and Soda Co. for 2015 and 2014. (Use 365 days in a year. Do not round intermediate calculations on Accounts Receivable Turnover Ratio. Round…Imagine that you are the financial analyst for XYZ Company. The organization is trying to determine why the collection of accounts receivable accounts has decreased by 30% over the last three months of this year. Would you utilize horizontal or vertical analysis to determine the decrease in account receivable collection? Explain your answer
- Letni Corporation engages in the manufacture and sale of semiconductor chips for the computing and communications industries. During the past year, operating revenues remained relatively flat compared to the prior year but management notices a big increase in accounts receivable. The increase in receivables is largely due to the recent economic slowdown in the computing and telecommunications industries. Many of the company’s customers are having financial difficulty, lengthening the period of time it takes to collect on accounts. Below are year-end amounts. Age Group OperatingRevenue AccountsReceivable AverageAge AccountsWritten Off Two years ago $ 1,160,000 $ 136,000 5 days $ 0 Last year 1,460,000 146,000 7 days 1,000 Current year 1,560,000 316,000 40 days 0 Paul, the CEO of Letni, notices that accounts written off over the past three years have been minimal and, therefore, suggests that no allowance for uncollectible accounts be…Letni Corporation engages in the manufacture and sale of semiconductor chips for the computing and communications industries. During the past year, operating revenues remained relatively flat compared to the prior year but management notices a big increase in accounts receivable. The increase in receivables is largely due to the recent economic slowdown in the computing and telecommunications industries. Many of the company’s customers are having financial difficulty, lengthening the period of time it takes to collect on accounts. Below are year-end amounts. Age Group OperatingRevenue AccountsReceivable AverageAge AccountsWritten Off Two years ago $1,160,000 $136,000 5 days $0 Last year 1,460,000 146,000 7 days 1,000 Current year 1,560,000 316,000 40 days 0 Paul, the CEO of Letni, notices that accounts written off over the past three years have been minimal and, therefore, suggests that no allowance for…Letni Corporation engages in the manufacture and sale of semiconductor chips for the computing and communications industries. During the past year, operating revenues remained relatively flat compared to the prior year but management notices a big increase in accounts receivable. The increase in receivables is largely due to the recent economic slowdown in the computing and telecommunications industries. Many of the company’s customers are having financial difficulty, lengthening the period of time it takes to collect on accounts. Below are year-end amounts. Age Group OperatingRevenue AccountsReceivable AverageAge AccountsWritten Off Two years ago $1,160,000 $ 136,000 5 days $0 Last year 1,460,000 146,000 7 days 1,000 Current year 1,560,000 316,000 40 days 0 Paul, the CEO of Letni, notices that accounts written off over the past three years have been minimal and, therefore, suggests that no allowance for uncollectible accounts be…
- If we know that for the year 2010 Johnson's Company had Cost of goods sold = 600,000 USD and Sales (on credit) = 850,000 USD. And at the beginning of this year Johnson's Company had Accounts Receivable = 75,000 USD and its Inventory = 110,000 USD. At the end of the year company's Accounts Receivable = 95,000 USD and Inventory = 130,000 USD. What is the accounts receivable turnover ratio for the year 2010?Company Abel has total sales of $364,500, of which, $60,500 represent cash sales. Its annual average accounts receivable balance is $74,400. Company Baker has total sales of $367,450, of which, $63,475 represent cash sales. Its annual average accounts receivable balance is $54,500. Which company has the favorable accounts receivable turnover experience?Your client, Corp. B, is a trading or distributor of home living product. Corp B import goods and sells them to its customers who are retail stores. In the current year, Corp. B's financial statements reported an increase in net income. The increase was driven by increased sales. Corp B's accounts receivable also increased rapidly. Corp B reportedly has many new customers.You are informed that there may be a fictitious revenue generated using fictitious customers. Corp B makes fictitious credit sales using bogus customers, and when receivables are due, management make kiting in order to look like the fictitious accounts receivable paid by their customer. What kind of audit procedure will you use to examine for possible kiting?