Queen Co.'s balance in accounts receivable is $240,000. Annual credit sales are $2,880,000. Queen's average collection period is

Question

Quizplus · Accepted Answer

To find the average collection period, we use the formula:

Average Collection Period = (Accounts Receivable / Annual Credit Sales) x 365 days

Plugging in the values we get,

Average Collection Period = (240,000 / 2,880,000) x 365 = 30.4 days

Therefore, the best choice is B.

Queen Co'S Balance in Accounts Receivable Is $240,000