A recent annual report for Kirova Company contained the following data: $$\begin{array} { l r r }
&{ \text { (in millions) } } \
& \underline { 2014 } & \underline { 2013 } \
\text { Accounts receivable } & \$ 2,023 & \$ 1,866 \
\text { Less: Allowance for doubtful accounts } & 50 & 52 \
\text { Net accounts receivable } & 1,976 & 1,814 \
\text { Net sales (all are on credit) } & 18,158 &
\end{array}$$ Required:
A. Calculate the accounts receivable turnover ratio.
B. Calculate the average days' sales in receivables for 2014 (rounded to the nearest day).
C. Explain the meaning of each number.

Question

A recent annual report for Kirova Company contained the following data: $$\begin{array} { l r r } 
&{ \text { (in millions) } } \
& \underline { 2014 } & \underline { 2013 } \
\text { Accounts receivable } & \$ 2,023 & \$ 1,866 \
\text { Less: Allowance for doubtful accounts } & 50 & 52 \
\text { Net accounts receivable } & 1,976 & 1,814 \
\text { Net sales (all are on credit) } & 18,158 &
\end{array}$$ Required: 
A. Calculate the accounts receivable turnover ratio.
B. Calculate the average days' sales in receivables for 2014 (rounded to the nearest day).
C. Explain the meaning of each number.

Quizplus · Accepted Answer

The Answer of A recent annual report for Kirova Company contained the following data: $$\begin{array} { l r r } 
&{ \text { (in millions) } } \
& \underline { 2014 } & \underline { 2013 } \
\text { Accounts receivable } & \$ 2,023 & \$ 1,866 \
\text { Less: Allowance for doubtful accounts } & 50 & 52 \
\text { Net accounts receivable } & 1,976 & 1,814 \
\text { Net sales (all are on credit) } & 18,158 &
\end{array}$$ Required: 
A. Calculate the accounts receivable turnover ratio.
B. Calculate the average days' sales in receivables for 2014 (rounded to the nearest day).
C. Explain the meaning of each number.

A Recent Annual Report for Kirova Company Contained the Following