Data from Dunshee Corporation's Most Recent Balance Sheet Appear Below

question 187

Multiple Choice

Data from Dunshee Corporation's most recent balance sheet appear below:
$\begin{array}{lrr}&\text { Year 2 } & \text { Year 1 } \\\text { Current assets: }\\\text { Cash}&\$ 130 & \$ 100 \\\text { Accounts receivable, net.}&270 & 290 \\\text {Inventory }&90 & 110 \\\text {Prepaid expenses }&10 & 10\\\text { Total current assets. }&\$500&\$510\\\text { Total current liabilities }&\$230&\$220\end{array}$ Sales on account in Year 2 amounted to $1,170 and the cost of goods sold was $730.
-The average sale period for Year 2 is closest to:

• A) 28.1 days
• B) 45.0 days
• C) 50.0 days
• D) 227.7 days

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Definitions:

Straight-Line Depreciation

A method of evenly distributing the cost of a tangible asset over its useful life, resulting in a fixed annual depreciation expense.

Required Rate Of Return

The minimum annual percentage earned by an investment that will induce individuals or companies to put money into a particular project or investment.

Tax Rate

The percentage rate at which the government taxes an individual’s or corporation’s income.

Sliding Clutches

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