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Dominik [7]
3 years ago
7

Ingraham Inc. currently has $320,000 in accounts receivable, and its days sales outstanding (DSO) is 63 days. It wants to reduce

its DSO to 25 days by pressuring more of its customers to pay their bills on time. If this policy is adopted, the company's average sales will fall by 20%. What will be the level of accounts receivable following the change
Business
1 answer:
TEA [102]3 years ago
7 0

Answer:

$44,186

Explanation:

Days sales outstanding can be expressed as the following financial ratio:

DSO ratio = accounts receivable / average sales per day, or.

DSO ratio = accounts receivable / (annual sales / 365 days)

Hence revised receivables / ( revised sales /365 ) will be our preferred formula for this scenario

Revised sales = 80% of current sales which is 0.8 x 320,000 = 256,000

daily sales = 256,000 / 365 = 701.3

revised receivables / 701.3 = 63 days as given in the question.

Revised receivables = 701.3 x 63 = $44,186

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Wall Drugs offered an incentive stock option plan to its employees. On January 1, 2021, options were granted for 75,000 $1 par c
valkas [14]

Answer:

the total compensation cost is $75,000

Explanation:

The computation of the total compensation cost for this plan is shown below:

Total compensation cost = option granted × fair value of each option

total compensation cost = 75000 × $1

total compensation cost = $75,000

Here to determined the total compensation cost we simply multiplied the option granted with the fair value of each option so that the correct amount could come

Therefore the total compensation cost is $75,000

4 0
3 years ago
Mega Loan Company has very stringent credit requirements and, accordingly, has negligible losses from uncollectible accounts. Th
AfilCa [17]

Answer: The correct answer is "(A) Materiality.".

Explanation: The concept demonstrated is Materiality because by having a mechanism for preventing bad accounts through their strict requirements, they only recorded bad accounts when they actually existed, instead of making a provision.

6 0
3 years ago
Select the items below which must be adjusted to the book balance: ________
Alona [7]

Answer:

b. Book Error

e. Interest earned on the Checking account

f. Collections of Accounts receivable by the bank.

Explanation:

Items which must be adjusted to the book balance as this question is concerned are <u>Book Error</u>, <u>Interest earned on the Checking account</u> & <u>Collections of Accounts receivable by the bank.</u>

These above items require adjustment in book balance to compute the adjusted book balance.

6 0
3 years ago
The Central Hydraulic Supply Company is a distributor of hydraulic supplies in the Midwest. Central handles standard fittings, t
Sidana [21]

Answer:

Check the explanation

Explanation:

The Economic Order Quantity EOQ= SQRT(2*D*Co/Ch),

Where Square root, SQRT, D is the annual demand , Co Cost of order and Ch is the cost of holding

Here annual Demand D =20500

Cost of order Co = 50 $

Cost of holding Ch= 20% of Cost of purchasing = 20%*$14 = $2.8

EOQ = SQRT(2*20500*50/2.8) = SQRT(732142.85) = 855 Units

Minimum TAC can be calculated in two ways

1) With Formula , Minimum TAC = SQRT(2*D*Co*Ch) = $2395.83

2) Without Formula , I.e Cost of Oreder+ Cost of Holding

=(20500/855)*$50 + (855/2)*$2.8 = 2395.83

Where 20500/855 is the number of orders, and 855/2 is the average stock

B) If 500 units purchased at a time

Then Number of orders = 20500/500 = 41 orders in year

Total cost ordering = 41*$50 = $2050

Inventory holding cost = Average inventory * holding cost =

= 500/2*$2.8 = 700

the Total/overall annual cost inventory = $2050+$700 = $2750

3 0
3 years ago
Ian and Harriet divorced in 2017. Their son, Preston, is age 10 and has lived with Ian for the last two years. The divorce decre
Eddi Din [679]

Harriet is the person that can claim the earned income credit because the divorce decree gives Harriet the right to claim Preston as a dependent.

<h3>What the law on divorce states</h3>

The law on divorce or separation decree states that the noncustodial parent may claim the dependent even when there is no written declaration from the custodial parent.

Other explanation includes:

  • The parent who the child spends the most time with may claim the dependent.
  • If only one of the taxpayers is the child’s parent, that parent may claim the dependent.

In conclusion, Harriet is the person that can claim the earned income credit because the divorce decree gives Harriet the right to claim Preston as a dependent.

Read more about income credit

<em>brainly.com/question/13522402</em>

3 0
2 years ago
Read 2 more answers
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