Powers Company reported Net sales of $1,200,000 and Accounts Receivable, net of $78,500. The Day's sales uncollected (rounded to whole days) is:
A) 4 days.
B) 56 days.
C) 24 days.
D) 48 days.
E) 15 days.

Question

Quizplus · Accepted Answer

To calculate the Days Sales Uncollected, we use the formula: 
Days Sales Uncollected = (Accounts Receivable / Net Sales) x Number of Days

Number of Days = 365 days (assuming a year)

Days Sales Uncollected = (78,500 / 1,200,000) x 365 = 23.89 ≈ 24 days

Therefore, the answer is choice C, 24 days.

Powers Company Reported Net Sales of $1,200,000 and Accounts Receivable