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gladu [14]
3 years ago
11

Dyl Pickle Inc. had credit sales of $4,000,000 last year and its days sales outstanding was DSO = 35 days. What was its average

receivables balance, based on a 365-day year.
a. $441,096
b. $318,356
c. $383,562
d. $471,781
e. $368,219
Business
2 answers:
Ede4ka [16]3 years ago
8 0

Answer:

. $383,562

Explanation:

Days of sales outstanding (DSO) = Number of days in a period / Receivables turnover

Receivables turnover  = Revenue /Average receivables

$4,000,000 /Average receivables = Receivables turnover

35 = 365 / ($4,000,000 /Average receivables)

Average receivables = $383,561.64

Montano1993 [528]3 years ago
6 0

Answer:

Option C

Average receivable balance=$383,562

Explanation:

<em>While the the Days sales outstanding (DSO) is the average length if time it takes a business to collect the amount  owing from customers in respect of credit sales</em>

<em>Average receivable balance is the amount of credit sales which is left uncollected on the average at the end of accounting period.</em>

The average receivable balance can be calculated as follows:

Average receive balance = DSO/365 × credit sales

Average receivable balance = 35/365 × 4,000,000 = 383,561.64  

Average receivable balance=$383,562

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