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Allen Company Finance

The Allen Company has monthly credit sales of $600,000. The average collection period is 90 days. The cost of production is 70 percent of the selling price. What is the Allen Company's average investment in accounts receivable?

a. 2,000,000
b. 1,500,000
c. 1,800,000
d. 1,600,000

Solution Preview

Average Monthly Sales - $600,000
Average Collection Period - 90 ...

$2.19