# Sales and a the cost of sales b more bad debts c a

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Chapter 2 / Exercise 41
Essential Calculus: Early Transcendentals
Stewart
Expert Verified
sales and A. the cost of sales. B. more bad debts. C. a high accounts receivable turnover. Roque, 2011 D. the cost of accounts receivables, such as collection, interest and cost of bad debts. 90. The average collection period for a firm measures the number of days A. Beyond a typical account becomes delinquent B. For a typical check to “clear” through the banking system. C. After a typical credit sale is made until the firm receives the payment. CMA 1295 D. Beyond the end of the credit period before a typical customer payment is received. 91. The average collection period for a firm measures the number of days after a typical credit sale is made until the firm receives the payment. It should be related to the firm’s credit terms. For example, a firm that allows 2/10, net 30 should have an average collection period of 92. An increase in the firm’s collection period means 93. Which of the following represents a firm’s average gross receivables balance? I. Average age in days of receivables × average daily sales II. Average daily sales × average collection period III. Annual credit sales ÷ accounts receivable turnover 94. Which of the following represents a firm’s average gross receivables balance? I. Days sales in receivables x accounts receivable turnover. II. Average daily sales x average collection period. III. Net sales / average gross receivables. A. I only. C. I and II only. Page 10 of 47
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Chapter 2 / Exercise 41
Essential Calculus: Early Transcendentals
Stewart
Expert Verified
MANAGEMENT ADVISORY SERVICES Working Capital Management
95. At any point in time, the level of accounts receivable on a corporate balance sheet is least affected by which one of the following factors?
96. The level of accounts receivable will most likely increase as:
D. Cash sales increase, current receivables ratio to past due increases, credit limits remain the same. RPCPA 0594
97. Changing a firm’s credit terms from 2/20, net/60 to 2/10, net/30 will generally