Compare to the companys credit terms

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Reference no: EM131225063

Contemporary Media Sign Company sells on account. Recently, Contemporary reported the following figures:

2013 2012

Net Credit Sales $ 572,000 $ 600,000

Receivables at end of year 38,700 46,100

Requirements Compute Contemporary’s days’ sales in receivables for 2013. (Round to the nearest day.)

Suppose Contemporary’s normal credit terms for a sale on account are “2/10, net 30.” How well does Contemporary’s collection period compare to the company’s credit terms? Is this good or bad for Contemporary?

Reference no: EM131225063

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