Asked by Manal Al-Hashmi on Jun 14, 2024



Suppose a firm has seasonal sales and customers that all pay promptly at the end of 30 days.Which of the following statements is NOT correct?

A) DSO will vary from month to month.
B) The quarterly uncollected balances schedule will be the same in each quarter.
C) The level of accounts receivable will be constant from month to month.
D) The ratio of accounts receivable to sales will vary from month to month.


Days Sales Outstanding, a financial metric that measures the average number of days that a company takes to collect payment after making a sale.

Seasonal Sales

Sales that fluctuate during certain times of the year due to seasonal factors, such as holidays or weather changes.

Accounts Receivable

Funds that customers have yet to pay to a company for products or services that have already been provided or consumed.

  • Gain insight into the concept and arithmetic operations related to Days Sales Outstanding (DSO), along with its connection to corporate credit and collection protocols.

Verified Answer

Sandra Sanchez

Jun 16, 2024

Final Answer :
Explanation :
Since the firm has seasonal sales, the level of accounts receivable will not be constant from month to month. It will vary based on the volume of sales in that particular month and the timely payments made by customers.