Webster, Inc. has sales of $267,000, costs of goods sold of $149,000, and average accounts receivable of $18,400. On average, how long does it take its credit customers to pay for their purchases?

A) 8.10 days
B) 14.51 days
C) 25.15 days
D) 38.81 days
E) 45.07 days

Question

tianze jiang · Accepted Answer

Final Answer : C, Explanation :  To calculate the average collection period, we use the formula: (Average Accounts Receivable / Sales) * 365. Plugging in the numbers: ($18,400 / $267,000) * 365 = 25.15 days.

Webster, Inc. has sales of $267,000, costs of goods sold of $149,000, and average accounts receivable of $18,400. On average, how long does it take its credit customers to pay for their purchases?

A) 8.10 days
B) 14.51 days
C) 25.15 days
D) 38.81 days
E) 45.07 days

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Learning Objectives

Related questions

Webster, Inc. has sales of $267,000, costs of goods sold of $149,000, and average accounts receivable of $18,400. On average, how long does it take its credit customers to pay for their purchases?A) 8.10 daysB) 14.51 daysC) 25.15 daysD) 38.81 daysE) 45.07 days

Definitions

Learning Objectives

Learning Objectives

Related questions

Webster, Inc. has sales of $267,000, costs of goods sold of $149,000, and average accounts receivable of $18,400. On average, how long does it take its credit customers to pay for their purchases?

A) 8.10 days
B) 14.51 days
C) 25.15 days
D) 38.81 days
E) 45.07 days