Solution-Comment on the credit collection policies of the

Comment on the credit collection policies of the company

Reference no: EM132562048

Question - The following information has been extracted from the financial statements of Crystal Craft Ltd.

	2015	2016	2017
Cash at bank	$44,000	$40,000	$36,000
Marketable securities	88,000	100,000	96,000
Accounts receivable	102,000	108,000	124,000
Sales revenue (all sales on credit)	1,108,000	1,120,000	1,130,000
Cost of sales	672,000	680,000	700,000

Required -

a) Calculate the following for years 2016 and 2017:

i. the receivables turnover ratio

ii. average collection period of accounts receivable.

b) Based on the ratios calculated in requirement a), comment on the credit collection policies of the company. What additional information would make an analysis of cash collection policies more meaningful?

Reference no: EM132562048

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Comment on the credit collection policies of the company

Reference no: EM132562048

Reference no: EM132562048

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