Music City Has an Average Collection Period of 34

question 32

Multiple Choice

Music City has an average collection period of 34.6 days and an average daily investment in receivables of $71,407. What are the annual credit sales given a 365-day year?

• A) $668,407
• B) $577,109
• C) $753,282
• D) $625,893
• E) $767,123

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Definitions:

Deductive Reasoning

A method of deduction where a final judgment comes from the consistency of numerous assumed-to-be-true premises.

Inductive Reasoning

A method of reasoning in which specific observations or data are analyzed to form a general conclusion or principle.

Formal Operational

The stage of cognitive development, as per Jean Piaget's theory, starting from about age 12 during which people begin to think logically about abstract concepts.

Cognitive Development

The study of how thinking, problem solving, and intelligence change and mature throughout life, especially during childhood.