Sensitron and Douglas Tools manufacture and market power tools and accessories. Sensitron targets customers in the professional contractor market, while Douglas Tools focuses on home users and professionals. Selected financial data for the companies appears below.
Required:
1. Calculate the accounts receivable turnover ratio for each firm for year 2010, 2009, 2008.
2. Suggest reasons for the differences in the accounts receivable turnover ratios for these two firms.

Question

Sensitron and Douglas Tools manufacture and market power tools and accessories. Sensitron targets customers in the professional contractor market, while Douglas Tools focuses on home users and professionals. Selected financial data for the companies appears below.
  Required:
1. Calculate the accounts receivable turnover ratio for each firm for year 2010, 2009, 2008.
2. Suggest reasons for the differences in the accounts receivable turnover ratios for these two firms.

Quizplus · Accepted Answer

The Answer of Sensitron and Douglas Tools manufacture and market power tools and accessories. Sensitron targets customers in the professional contractor market, while Douglas Tools focuses on home users and professionals. Selected financial data for the companies appears below.
  Required:
1. Calculate the accounts receivable turnover ratio for each firm for year 2010, 2009, 2008.
2. Suggest reasons for the differences in the accounts receivable turnover ratios for these two firms.

Sensitron and Douglas Tools Manufacture and Market Power Tools and Accessories