Tone Loc and 89 of his biggest fans formed an S corporation, 2hit, Incorporated, as the original 90 shareholders. Tone then tran
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Answer: The average collection period of the receivables in terms of days was 73 days.
Explanation:
Given that,
Accounts Receivable at the beginning of the year = $390,000
Accounts Receivable at the end of the year = $410,000
Net credit sales during the year = $2,000,000
Average collection period of the receivables in terms of days:
Average accounts receivables =
= 4,00,000
Net credit sales = = 5
∴ Accounts receivable days =
= 73 days
The average collection period of the receivables in terms of days was 73 days.
A firm expects to sell 25,500 units of its product at $16 per unit. pretax income is predicted to be $60,500. If variable costs are $8 per unit, total fixed costs must be $143,500.
Fixed costs are costs that stay constant no matter changes in production volume, implying that irrespective of whether output rises or decreases, total fixed costs remain constant within the relevant range.
Rent, labor, depreciation, insurance, and other fixed costs per unit fluctuate over the relevant range, on the contrary.
Given,
Selling price = $16
Variable cost per unit = $8
Units sold = 25,500
Pretax income = $60,500
Substituting the provided information into the above calculation yields,
Contribution margin =
= $204,000
Formula:
This symbolizes,
Substituting the provided information into the above calculation yields,
= $143,500
Hence, the answer is $143,500.
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