Financial Accounting
15th Edition
ISBN: 9781337272124
Author: Carl Warren, James M. Reeve, Jonathan Duchac
Publisher: Cengage Learning
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Question
Chapter 17, Problem 10E
a. (1)
To determine
Compute accounts receivable turnover ratio for X and Y. and number of days’ sales in receivables.
a. (2)
To determine
Compute number of days’ sales in receivables for X and Y.
b)
To determine
Provide conclusion about accounts receivables and credit policies.
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Accounts Receivable Analysis
Xavier Stores Company and Lestrade Stores Inc. are large retail department stores. Both companies offer credit to their customers through their own credit card operations. Information from the financial statements
for both companies for two recent years is as follows (in millions):
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Lestrade
Sales
$310,250
$434,350
Credit card receivables-beginning
46,788
49,619
Credit card receivables-ending
39,062
38,203
a. Determine the (1) accounts receivable turnover and (2) the number of days' sales in receivables for both companies. Round answers to one decimal place. ASsume 365 days a year.
Xavier
Lestrade
1. Accounts receivable turnover
2. Number of days' sales in receivables
days
days
b. Xavier's accounts receivable turnover is
than Lestrade's. The number of days' sales in receivables is
for Xavier than for Lestrade. These differences indicate that Xavier
is able to turn over its receivables
quickly than Lestrade. As a result, it takes Xavier
time to collect…
Accounts Receivable Analysis
Xavier Stores Company and Lestrade Stores Inc. are large retail department stores. Both companies offer credit to their customers through their own credit card operations. Information from the financial statements for both companies for two recent years is as follows (in millions):
Xavier
Lestrade
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$219,000
$306,600
Credit card receivables-beginning
40,352
63,501
Credit card receivables-ending
33,688
48,891
a. Determine the (1) accounts receivable turnover and (2) the number of days' sales in receivables for both companies. Round answers to one decimal place. Assume 365 days a year.
Xavier
Lestrade
1. Accounts receivable turnover
fill in the blank 1
fill in the blank 2
2. Number of days' sales in receivables
fill in the blank 3
days
fill in the blank 4
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b. Xavier’s accounts receivable turnover is
than Lestrade’s. The number of days' sales in receivables is
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Fizzy Sodas and Hayes Companies are two of the largest and most successful beverage companies in the world in terms of the
products that they sell and their receivables management practices. To evaluate their ability to collect on credit sales, consider the
following rounded amounts reported in their annual reports (amounts in millions).
Fiscal Year Ended:
Net Sales
Accounts Receivable
Allowance for Doubtful Accounts
Accounts Receivable, Net of Allowance
Req 1
Complete this question by entering your answers in the tabs below.
Req 2A
Required:
1. Calculate the receivables turnover ratios and days to collect for Fizzy Sodas and Hayes Companies for 2018 and 2017.
2-a. Which of the companies was quicker to convert its receivables into cash in 2018?
2-b. Which of the companies was quicker to convert its receivables into cash in 2017?
Req 2B
Receivables Turnover Ratio
Days to collect
2018
2018
$ 40,630
4,410
620
3,790
Fizzy Sodas
Fizzy Sodas
2017
$ 45,120
4,710
610
4,100
Hayes
Companies…
Chapter 17 Solutions
Financial Accounting
Ch. 17 - Prob. 1DQCh. 17 - What is the advantage of using comparative...Ch. 17 - Prob. 3DQCh. 17 - How would the current and quick ratios of a...Ch. 17 - Prob. 5DQCh. 17 - What do the following data, taken from a...Ch. 17 - a. How does the return on total assets differ from...Ch. 17 - Prob. 8DQCh. 17 - Prob. 9DQCh. 17 - Prob. 10DQ
Ch. 17 - Prob. 1PEACh. 17 - Prob. 1PEBCh. 17 - Prob. 2PEACh. 17 - Vertical analysis Income statement information for...Ch. 17 - Prob. 3PEACh. 17 - Prob. 3PEBCh. 17 - Prob. 4PEACh. 17 - Prob. 4PEBCh. 17 - Prob. 5PEACh. 17 - Inventory analysis A company reports the...Ch. 17 - Prob. 6PEACh. 17 - Prob. 6PEBCh. 17 - Times interest earned A company reports the...Ch. 17 - Times interest earned A company reports the...Ch. 17 - Asset turnover A company reports the following:...Ch. 17 - Asset turnover A company reports the following:...Ch. 17 - Prob. 9PEACh. 17 - Prob. 9PEBCh. 17 - Common stockholders' profitability analysis A...Ch. 17 - Common stockholders' profitability analysis A...Ch. 17 - Earnings per share and price-earnings ratio A...Ch. 17 - Earnings per share and price-earnings ratio A...Ch. 17 - Vertical analysis of income statement Revenue and...Ch. 17 - Prob. 2ECh. 17 - Common-sized income statement Revenue and expense...Ch. 17 - Prob. 4ECh. 17 - Prob. 5ECh. 17 - Current position analysis The following data were...Ch. 17 - Prob. 7ECh. 17 - Current position analysis The bond indenture for...Ch. 17 - Accounts receivable analysis The following data...Ch. 17 - Prob. 10ECh. 17 - Inventory analysis The following data were...Ch. 17 - Inventory analysis QT, Inc. and Elppa Computers,...Ch. 17 - Ratio of liabilities to stockholders equity and...Ch. 17 - Prob. 14ECh. 17 - Ratio of liabilities to stockholders equity and...Ch. 17 - Prob. 16ECh. 17 - Profitability ratios The following selected data...Ch. 17 - Profitability ratios Ralph Lauren Corporation...Ch. 17 - Six measures of solvency or profitability The...Ch. 17 - Five measures of solvency or profitability The...Ch. 17 - Earnings per share, price-earnings ratio, dividend...Ch. 17 - Prob. 22ECh. 17 - Earnings per share, discontinued operations The...Ch. 17 - Prob. 24ECh. 17 - Unusual items Explain whether Colston Company...Ch. 17 - Horizontal analysis of income statement For 20Y2,...Ch. 17 - Prob. 2PACh. 17 - Effect of transactions on current position...Ch. 17 - Measures of liquidity, solvency, and profitability...Ch. 17 - Solvency and profitability trend analysis Addai...Ch. 17 - Prob. 1PBCh. 17 - Prob. 2PBCh. 17 - Effect of transactions on current position...Ch. 17 - Prob. 4PBCh. 17 - Solvency and profitability trend analysis Crosby...Ch. 17 - Financial statement analysis The financial...Ch. 17 - Prob. 1CPCh. 17 - Prob. 3CPCh. 17 - Prob. 4CPCh. 17 - Prob. 5CPCh. 17 - The average liabilities, average stockholders'...
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