INTERMEDIATE ACCOUNTING(LL)-W/2 ACCESS
9th Edition
ISBN: 9781260180657
Author: SPICELAND
Publisher: MCG
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Chapter 7, Problem 7.26E
To determine
Accounts Receivable Turnover:
The accounts receivable turnover ratio determines the efficiency of a company to use its assets and issue the credit to the customers and collects the funds from them. The accounts receivable turnover is determined by dividing the credit sales by the average accounts receivable of that accounting period.
Days’ sales uncollected
Days’ sales uncollected (Average collection period): Days’ sales uncollected indicates that on average, how long it takes to collects receivable. It is calculated dividing the number of days in a year by the receivable turn over.
To Compute: The amount of sales for 2018.
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Problem 6-7: The Chancellor Corporation
The following information was available for the Chancellor Corporation on December 31, 2021:
Year
2019
2020
2021
Sales
3000
9000
7000
Accounts Receivable
800
100
300
Required:
1. Calculate Receivables Turnover in 2021 (round to 2 decimal places).
2. Calculate the average days to collect receivables in 2020. Assume a 365 day year and round all results to the nearest day.
3. Calculate the average days to collect receivables in 2021. Assume a 365 day year and round all results to the nearest day.
Upon completion, enter your answers below (2 decimal places):
Receivables Turnover (2021):
Days to Collect Receivables (2020):
Days to Collect Receivables (2021):
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Question 8 of 8
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Select financial information from Marshall Inc. is shown below:
2022
2021
Receivables
$423,018
$376,089
less allowance for doubtful accounts
45,890
32,236
Receivables, net
377,128
343,853
Credit sales
5,245,000
4,846,300
Calculate the receivables turnover and the collection period for 2022. (Round answers to 1 decimal place, e.g. 12.3.)
Receivables Turnover Ratio
times
Average Collection Period
days
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References
6
Sales
Cost of goods sold
Accounts receivable
Numerator:
2821
$ 522,732
269,043
25,300
Numerator:
Compute trend percents for the above accounts, using 2017 as the base year. For each of the three accounts, state whether the
situation as revealed by the trend percents appears to be favorable or unfavorable.
Type here to search
1
2021:
2020:
2019:
2018:
2017:
Is the trend percent for Net Sales favorable or unfavorable?
Numerator:
2020
$ 348,488
179,479
20,456
Trend Percent for Net Sales:
1
T
1
1
1
1
2021:
T
2020:
1
2019:
T
2018:
1
2017:
1
Is the trend percent for Cost of Goods Sold favorable or unfavorable?
2019
$ 279,918
146,254
19,146
Trend Percent for Cost of Goods Sold:
1
Denominator:
Denominator:
Trend Percent for Accounts Receivable:
I
Denominator:
2021:
2020:
2019:
2018:
1
2017:
1
Is the trend percent for Accounts Receivable favorable or unfavorable?
1
1
1
O
2018
$ 195,059
101,230
11,352
=
=
M
=
=
=
=
=
=
=
=
=
2017
$ 148,900
75,939
10, 200
Trend…
Chapter 7 Solutions
INTERMEDIATE ACCOUNTING(LL)-W/2 ACCESS
Ch. 7 - Prob. 7.1QCh. 7 - Prob. 7.2QCh. 7 - Prob. 7.3QCh. 7 - Prob. 7.4QCh. 7 - Prob. 7.5QCh. 7 - Prob. 7.6QCh. 7 - Distinguish between the gross and net methods of...Ch. 7 - Briefly explain the accounting treatment for sales...Ch. 7 - Explain the typical way companies account for...Ch. 7 - Briefly explain the difference between the income...
Ch. 7 - Prob. 7.11QCh. 7 - Is any special accounting treatment required for...Ch. 7 - Explain any possible differences between...Ch. 7 - Prob. 7.14QCh. 7 - What is meant by the discounting of a note...Ch. 7 - What are the key variables that influence a...Ch. 7 - Explain how the CECL model (introduced in ASU No....Ch. 7 - Prob. 7.18QCh. 7 - Prob. 7.19QCh. 7 - (Based on Appendix 7B) Marshall Companies, Inc.,...Ch. 7 - Prob. 7.21QCh. 7 - Prob. 7.1BECh. 7 - Prob. 7.2BECh. 7 - Prob. 7.3BECh. 7 - Cash discounts; gross method LO73 On December 28,...Ch. 7 - Prob. 7.5BECh. 7 - Sales re turns LO74 During 2018, its first year...Ch. 7 - Sales re turns LO74 Refer to the situation...Ch. 7 - Prob. 7.8BECh. 7 - Prob. 7.9BECh. 7 - Uncollectible accounts; balance sheet approach ...Ch. 7 - Uncollectible accounts; solving for unknown LO75,...Ch. 7 - Prob. 7.12BECh. 7 - Note receivable LO77 On December 1, 2018,...Ch. 7 - Long-term notes receivable LO74 On April 19,...Ch. 7 - Prob. 7.15BECh. 7 - Factoring of accounts receivable LO78 Refer to...Ch. 7 - Prob. 7.17BECh. 7 - Discounting a note LO78 On March 31, Dower...Ch. 7 - Receivables turnover LO78 Camden Hardwares credit...Ch. 7 - Prob. 7.20BECh. 7 - Prob. 7.21BECh. 7 - Impairments of Accounts Receivable Appendix 7B...Ch. 7 - Credit Losses on Accounts Receivable (CECL Model) ...Ch. 7 - Prob. 7.1ECh. 7 - Prob. 7.2ECh. 7 - Prob. 7.3ECh. 7 - Prob. 7.4ECh. 7 - Trade and cash discounts; the gross method and the...Ch. 7 - Prob. 7.6ECh. 7 - Cash discounts; the net method LO73 [This is a...Ch. 7 - Sales returns LO74 Halifax Manufacturing allows...Ch. 7 - Prob. 7.9ECh. 7 - Prob. 7.10ECh. 7 - Uncollectible accounts; allowance method; balance...Ch. 7 - Uncollectible accounts; allowance method and...Ch. 7 - Uncollectible accounts; allowance method; solving...Ch. 7 - Note receivable LO77 On June 30, 2018, the...Ch. 7 - Noninterest-bearing note receivable LO77 [This is...Ch. 7 - Long-term notes receivable LO77 On January 1,...Ch. 7 - Prob. 7.17ECh. 7 - Prob. 7.18ECh. 7 - Prob. 7.19ECh. 7 - Factoring of accounts receivable with recourse ...Ch. 7 - Factoring of accounts receivable with recourse...Ch. 7 - Discounting a note receivable LO78 Selkirk...Ch. 7 - Concepts; terminology LO71 through LO78 Listed...Ch. 7 - Receivables; transaction analysis LO73, LO75...Ch. 7 - Prob. 7.25ECh. 7 - Prob. 7.26ECh. 7 - Prob. 7.27ECh. 7 - Prob. 7.28ECh. 7 - Prob. 7.29ECh. 7 - Prob. 7.30ECh. 7 - Impairments of Notes Receivable Appendix 7B At...Ch. 7 - Prob. 7.32ECh. 7 - Prob. 7.33ECh. 7 - Prob. 7.34ECh. 7 - Uncollectible accounts; allowance method; income...Ch. 7 - Uncollectible accounts; Amdahl LO75 Real World...Ch. 7 - Bad debts; Nike, Inc. LO75 Real World Financials...Ch. 7 - Uncollectible accounts LO75, LO76 Raintree...Ch. 7 - Prob. 7.5PCh. 7 - Notes receivable; solving for unknowns LO77...Ch. 7 - Prob. 7.7PCh. 7 - Prob. 7.8PCh. 7 - Prob. 7.9PCh. 7 - Prob. 7.10PCh. 7 - Prob. 7.11PCh. 7 - Accounts and notes receivable; discounting a note...Ch. 7 - Prob. 7.13PCh. 7 - Prob. 7.14PCh. 7 - Prob. 7.15PCh. 7 - Prob. 7.16PCh. 7 - Prob. 7.17PCh. 7 - Prob. 7.1BYPCh. 7 - Prob. 7.2BYPCh. 7 - Prob. 7.3BYPCh. 7 - Real World Case 74 Sales returns; Green Mountain...Ch. 7 - Ethics Case 75 Uncollectible accounts LO75 You...Ch. 7 - Prob. 7.6BYPCh. 7 - Prob. 7.7BYPCh. 7 - Prob. 7.8BYPCh. 7 - Prob. 7.9BYPCh. 7 - Prob. 7.10BYPCh. 7 - Prob. 7.11BYPCh. 7 - Prob. 1CCTC
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