If a firm has $400,000 in credit sales and $50,000 in average account receivable, average days collection is approximately
A) 29.2.
B) 292.
C) 45.63.
D) 5.563.

Name: If a firm has $400,000 in credit sales and $50,000 in average account receivable, average days collection is approximately A) 29.2. B) 292. C) 45.63. D) 5.563.
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Question

Quizplus · Accepted Answer

Average days collection is calculated as (Average Accounts Receivable / Credit Sales) * 365. Here, it is ($50,000 / $400,000) * 365 = 45.63 days.

If a Firm Has $400,000 in Credit Sales and $50,000