Data from Dunshee Corporation's most recent balance sheet appear below: Sales on account in Year 2 amounted to $1,170 and the cost of goods sold was $730.The average sale period for Year 2 is closest to: (Round your intermediate calculations to 2 decimal places.)
A) 28.1 days
B) 45.0 days
C) 50.0 days
D) 227.7 days

Question

Data from Dunshee Corporation's most recent balance sheet appear below:  Sales on account in Year 2 amounted to $1,170 and the cost of goods sold was $730.The average sale period for Year 2 is closest to: (Round your intermediate calculations to 2 decimal places.)
A) 28.1 days 
B) 45.0 days 
C) 50.0 days 
D) 227.7 days

Quizplus · Accepted Answer

Average Sale Period = (Accounts Receivable / Average Daily Sales)

Accounts Receivable = $510 ($540 - $30)

Average Daily Sales = Annual Sales on Account / 365
= $1,170 / 365
= $3.21

Therefore, Average Sale Period = 510 / 3.21 = 158.57 days

Thus, the closest answer choice is C) 50.0 days.

Data from Dunshee Corporation's Most Recent Balance Sheet Appear Below