qs 6-15 (algo) days sales uncollected lo a1\nthe following annual account balances are from armour sports at…

qs 6-15 (algo) days sales uncollected lo a1\nthe following annual account balances are from armour sports at december 31.\n\n| | year 2 | year 1 |\n|--|--|--|--|\n| accounts receivable | $61,977 | $54,686 |\n| net sales | 737,526 | 557,209 |\n\na. complete the below table to calculate the number of days sales uncollected for the year 1 and year 2.\nnote: do not round intermediate calculations. round your \days sales uncollected\ to 1 decimal place.\n\n| | choose numerator: | / | choose denominator: | x | days | = | days sales uncollected |\n|--|--|--|--|--|--|--|--|\n| year 2: | | / | | x | | = | days |\n| year 1: | | / | | x | | = | days |\n\nb. is the companys collection of receivables improving?\nyes\nno

qs 6-15 (algo) days sales uncollected lo a1\nthe following annual account balances are from armour sports at december 31.\n\n| | year 2 | year 1 |\n|--|--|--|--|\n| accounts receivable | $61,977 | $54,686 |\n| net sales | 737,526 | 557,209 |\n\na. complete the below table to calculate the number of days sales uncollected for the year 1 and year 2.\nnote: do not round intermediate calculations. round your \days sales uncollected\ to 1 decimal place.\n\n| | choose numerator: | / | choose denominator: | x | days | = | days sales uncollected |\n|--|--|--|--|--|--|--|--|\n| year 2: | | / | | x | | = | days |\n| year 1: | | / | | x | | = | days |\n\nb. is the companys collection of receivables improving?\nyes\nno

Answer

Explanation:

Step1: Recall the formula

The formula for days' sales uncollected is $\frac{\text{Accounts Receivable}}{\text{Net Sales}}\times365$.

Step2: Calculate for Year 2

For Year 2, accounts receivable = $61,977$ and net sales = $737,526$. $\frac{61977}{737526}\times365=\frac{61977\times365}{737526}\approx30.5$

Step3: Calculate for Year 1

For Year 1, accounts receivable = $54,686$ and net sales = $557,209$. $\frac{54686}{557209}\times365=\frac{54686\times365}{557209}\approx35.7$

Choose Numerator / Choose Denominator x Days = Days' Sales Uncollected
Year 2 $61,977$ / $737,526$ x $365$ = $30.5$ days
Year 1 $54,686$ / $557,209$ x $365$ = $35.7$ days

Step4: Answer part b

Since the days' sales uncollected decreased from $35.7$ days in Year 1 to $30.5$ days in Year 2, the company's collection of receivables is improving.

Answer:

Choose Numerator / Choose Denominator x Days = Days' Sales Uncollected
Year 2 $61,977$ / $737,526$ x $365$ = $30.5$ days
Year 1 $54,686$ / $557,209$ x $365$ = $35.7$ days
b. Yes