Vista Inc. had the following balances in selected accounts at the end of 2013 and 2014.
The accounts receivable at the end of 2012 were $50,000 and the allowance for uncollectible accounts was $2,500.
Required:
a. Calculate the acid test ratio for 2013 and 2014 for Vista Inc.
b. Calculate the days' sales in receivables for 2013 and 2014 for Vista Inc.
c. Determine whether the acid-test ratio improved or deteriorated from 2013 to 2014.
d. Determine whether the collection period increased or decreased from 2013 to 2014.

Question

Vista Inc. had the following balances in selected accounts at the end of 2013 and 2014.
  The accounts receivable at the end of 2012 were $50,000 and the allowance for uncollectible accounts was $2,500.
Required:
a. Calculate the acid test ratio for 2013 and 2014 for Vista Inc.
b. Calculate the days' sales in receivables for 2013 and 2014 for Vista Inc.
c. Determine whether the acid-test ratio improved or deteriorated from 2013 to 2014.
d. Determine whether the collection period increased or decreased from 2013 to 2014.

Quizplus · Accepted Answer

The Answer of Vista Inc. had the following balances in selected accounts at the end of 2013 and 2014.
  The accounts receivable at the end of 2012 were $50,000 and the allowance for uncollectible accounts was $2,500.
Required:
a. Calculate the acid test ratio for 2013 and 2014 for Vista Inc.
b. Calculate the days' sales in receivables for 2013 and 2014 for Vista Inc.
c. Determine whether the acid-test ratio improved or deteriorated from 2013 to 2014.
d. Determine whether the collection period increased or decreased from 2013 to 2014.

Vista Inc Had the Following Balances in Selected Accounts at the the End