Given below are comparative balance sheets and an income statement for the Richmond Corporation...Please see attachment for table
Please see attachment for all questions© BrainMass Inc. brainmass.com June 3, 2020, 5:14 pm ad1c9bdddf
(a)The accounts receivable turnover is determined by net sales/receivables. Since they are asking for average accounts receivable turnover, you need to use the average receivables for the period, or (90000 + 74000)/2. So the ratio would be found using:
410000/82000 = 5. This means that accounts receivable turns over 5 times a year, or every 365/5 = 73 days.
(b) Average inventory turnover is similar, but using the average inventory for the year, ...
The comparative balance sheets and income statements are examined. The inventory turnover averages are determined.