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kirza4 [7]
3 years ago
14

Chik’s Chickens has accounts receivable of $6,333. Sales for the year were $9,800. What is its average collection period?

Business
1 answer:
MAXImum [283]3 years ago
6 0

Answer:

235.5 days

Explanation:

Chik's chicken has accounts receivables of $6,333

The sales for the year for Chik's chicken is $9,800

The first step is to calculate the receivables turnover

= $9,800/$6,333

= 1.55

Therefore the average collection period for Chik's chicken can be calculated as follows

= 365/1.55

= 235.5 days

Hence the average collection period for Chik's chicken is 235.5 days

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