The financial statements of Gentry Manufacturing Company report net sales of €600,000 and accounts receivable of €80,000 and €40,000 at the beginning and end of the year, respectively. What is the average collection period for accounts receivable in days?

Question

Quizplus · Accepted Answer

Average Collection Period = (Accounts Receivable / Net Sales) * 365 days
= ( (80,000 + 40,000)/2 ) / 600,000 * 365 days
= 36.5 days. 
Therefore, the answer is C.

The Financial Statements of Gentry Manufacturing Company Report Net Sales