The Following Information Was Extracted from the Financial Records of Ross

question 51

Multiple Choice

The following information was extracted from the financial records of Ross Ltd for the year ended 30 June 2018: $$\begin{array} { l r } \text { Cash Sales } & \$ 50,000 \\\text { Credit Sales } & 200,000 \\\text { Accounts receivable } & 25,000 \\\text { Cost of Sales } & 130,000\end{array}$$ If there are 365 trading days per year, calculate for the managing director the number of days that accounts receivable are outstanding at 30 June 2018.

• A)86 days.
• B)51 days.
• C)114 days.
• D)46 days.

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Definitions:

Downward Sloping Demand

A fundamental principle in economics that suggests demand for a product decreases as the price increases, illustrated by a demand curve that slopes downwards from left to right.

Homogeneous Product

A Homogeneous Product is one that is seen as identical or very similar in nature, quality, and performance, regardless of the producer.

Excess Capacity

A situation where a company produces less than the maximum amount it can produce due to lower demand.

Equilibrium

A state where supply equals demand in a market, resulting in an optimal distribution of goods and services.