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Provide two possible solutions to the accounts receivable

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Reference no: EM132944143

Milo Ltd is engaged in the manufacture and sale of furniture. Customers consist of government agencies, hotels, and fully furnished apartments for rent. You have been recently hired as Finance Manager. The CEO of Milo Ltd has been complaining about the company's accounts receivable collection period which averaged 120 days. Milo Ltd needs $500,000 to purchase additional equipment. During a meeting, the CEO asked you for two solutions to address the average accounts receivable collection situation. Before you could respond, another employee commented the company has more than $500,000 in accumulated depreciation for existing equipment. The accumulated depreciation could be a source of funding for the purchase of additional equipment.

Problem 1) Do you agree or disagree with the comment regarding the accumulated depreciation? Explain your answer.

Problem 2) Provide two possible solutions to the accounts receivable collection situation.

Reference no: EM132944143

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