The Flower Shoppe has accounts receivable of $3,709, inventory of $4,407, sales of $218,640, and cost of goods sold of $167,306. How many days does it take the firm to both sell its inventory and collect the payment on the sale assuming that all sales are on credit?
A)14.67 days
B)15.81 days
C)16.23 days
D)17.18 days
E)17.47 days

Question

Quizplus · Accepted Answer

Days in inventory = 365/($167,306/$4,407) = 9.614 daysDays' sales in receivables = 365/($218,640/$3,709) = 6.192 daysTotal days in inventory and receivables = 9.614 + 6.192 = 15.81 days

The Flower Shoppe Has Accounts Receivable of $3,709, Inventory of $4,407