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Sonbull [250]
3 years ago
9

The 2011 income statements of Leggett & Platt, Inc., reports net sales of $3,636.0 million in 2011 and $3,359.1 million in 2

010. The balance sheet reports accounts and other receivables, gross of $527.9 million at December 31, 2011, and $501.0 million at December 31, 2010. Calculate the average number of days that receivables were outstanding in 2011. Explain in plain English, what this ratio means. Did it improve from 2010?
Business
1 answer:
san4es73 [151]3 years ago
5 0

Answer:

a) Average number of days in 2011 = 53 days

b) The days are lower than 2010, so it is better than 2010.

Explanation:

the question is to calculate the average number of days that receivables were outstanding in 2011

First, the formula

= (Accounts Receivable/The Net Credit Sales for the Period) x 365 days (days in a year)

Therefore:

1) The Net Sales for 2011 = $3,636 million

Accounts receivable for 2011=  $527.9 million

We then calculate the Receivable days outstanding for 2011 as follows

= 527.9 million  / 3,636 million x 365 = 53 days

2) The Net Sales for 2010= $3,359.1 million

Accounts receivable for 2010=  $501  million

We then calculate the Receivable days outstanding for 2010 as follows

= 501 million  / 3359.1 million x 365 = 54. 4 day

It should be noted that the higher the days of receivable were outstanding then the slower the revenue collection rate after sales. Therefore, a lower number of days is better.

Based on this, 2011 is better than 2010 because the number of days have reduced from 54.4 to 53 days.

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Stress is considered as a defensive mechanism, as it follows the three stages of resistance, alarm, and exhaustion. The psychological stress is usually associated with negative life changes.

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5 0
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you want to put $2,500 in a simple interest account. It has a 4% annual interest rate. How long will it take you to earn $200 in
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3 years ago
Millco, Inc., acquired a machine that cost $1,200,000 early in 2016. The machine is expected to last for eight years, and its es
Likurg_2 [28]
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5 0
2 years ago
Last year there was no change in either the raw materials or the work in process beginning and ending inventories. However, fini
dsp73

Answer:

d. $625,000

Explanation:

cost of goods available for sale = cost of goods manufactured during the current period + finished goods inventory at the beginning of the period

  • cost of goods manufactured during the current period = $600,000
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cost of goods available for sale = $600,000 + $25,000 = $625,000

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2 years ago
What is the difference between an increase in demand and an increase in quantity demanded?.
Setler [38]

Answer:

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Explanation:

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