Answer:
Company 1 is most likely to have lost sales due to an inventory shortage.
Explanation:
Inventory turnover is the ratio that how many time a business has sold or replaced the inventory during a given period. A business is considered more profitable if it has high inventory turnover.
Company with highest Inventory turnover may lost sales due to inventory shortage. Company 1 1 has the highest inventory turnover of 46.3. Which may lead to to the shortage of stock because the inventory in stock is more likely to sold earlier than other companies. High inventory turnover will lead to low inventory days.
Answer:
B $3000/year
Explanation:
The minimum amount of salary that Danny should contribute to his 401(k) plan each year = 6% of his annual salary = 6/100 × $50000 = $3000/year
Answer:
no cash was collected during the period
or
cash collections during the year are less than the amount of revenue recognized
Explanation:
For example if we had Accounts receivable beginning balance $ 250,000 and Sales of $ 500,000 are made on accounts then the Total Accounts receivable will be $ 750,000.
But out of the $ 500,000 sales only $300,00 cash is collected and the remaining $ 200,000 is still in the Accounts receivable balance so the ending Accounts receivable balance will be $ 250,000 + $200,000 = $ 450,000 which will be greater than beginning Accounts receivable balance.
So there are two possibilities either cash collections during the year are less than the amount of revenue recognized.
or
no cash was collected during the period.
Similarly it cannot be choice no 1 : collections during the period exceed the amount of revenue recognized
Because if more cash is collected then ending account receivable balance would be less than the beginning account receivable balance.
Choice no 3 is also wrong if cash collections are more than the ending accounts receivable balance would be less
Answer:
Receivable turnover ratio = 8.1 times
Account receivable days = 44.9 days
Explanation:
<em>Th account receivable days is the average length of time it takes a business to collect amount due on account from customers</em>
A<em>ccount receivable ratio = Net sales /Average account receivable</em>
<em>Account receivable days = (Average receivable/Net sales) × 365 days</em>
<em>Average account receivable</em>
= (Receivable at the beginning + Receivable at the end)/2
= ( 4,830+ 5,130)/2
=4980
<em>Note that the accounts receivable balance at the end of 2015 will be the opening balance at the beginning of 2016. The closing balance of 4,830 of 2015 will be the opening balance for 2016</em>
Receivable turnover ratio
=45,500/4980
= 8.1 times
Account receivable days
= (4980/45,500)× 365 days
= 44.9 days
