Redwing Company Has the Following Data Current Assets What Is the Average Collection Period in Days for Redwing

question 25

Multiple Choice

Redwing Company has the following data: $\begin{array}{llll}&2X13&2X12&2X11\\\text { Sales (all credit sales) } & \$ 800 & \$ 740 & \$ 675 \\\text { Less Cost of Goods Sold } & \underline{525} & \underline{490} &450\\\text { Gross Profit }& \$ 275 &\$ 250 &\$ 225\\\end{array}$
Current Assets:
$\begin{array} { l l l l } \text { Cash } & \$ 25 & \$ 20 & \$ 15 \\\text { Accounts Receivable } & 90 & 70 & 60 \\\text { Inventery } & 65 & 50 & 40 \\\text { Prepaid Rent } & \underline { 10 } & \underline { 15 } & 5 \\\text { Total Current Assets } & \$ 190 & \$ 155 & \$ 120\end{array}$
What is the average collection period in days for Redwing Company in 2X13? Has the average collection period in days improved or not improved since 2X12?

• A)41.1,improved
• B)36.5,improved
• C)36.5,not improved
• D)8.9,improved
• E)41.1,not improved

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