At the end of the third year,the Treadwell Tire Company had accounts receivable of $66,600,and at the end of the fourth year,the company had accounts receivable of $72,600.If the company's net sales revenue during the fourth year were $876,000,the days- to -collect during year four was:

Question

Quizplus · Accepted Answer

To calculate the days-to-collect, we use the following formula:
Days-to-Collect = (Accounts Receivable / Net Sales Revenue) x Number of Days in Year

Number of days in a year is usually assumed to be 365.
Using the formula:
Days-to-Collect = (72600 / 876000) x 365
Days-to-Collect = 30.25 (rounded to the nearest whole number)

Therefore, the answer is B) 29, which is the closest whole number to 30.25.

At the End of the Third Year,the Treadwell Tire Company