The Following Information Was Extracted from the Financial Records of Ross

question 50

Multiple Choice

The following information was extracted from the financial records of Ross Ltd for the year ended 30 June 2018: $\begin{array}{ll}\text { Cash Sales } & \$ 50,000 \\\text { Credit Sales } & 200,000 \\\text { Accounts receivable } & 25,000 \\\text { Cost of Sales } & 130,000\end{array}$ 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:

Constant Annual Dividend

A dividend payment that a company commits to distribute to its shareholders at a steady rate each year.

Rate of Return

An indicator of the financial success or failure of an investment, calculated by dividing the profit (or loss) by the investment’s initial cost.

Dividend Amount

The total sum of money paid to shareholders, typically expressed on a per-share basis, from a corporation's earnings.

Required Rate of Return

The lowest expected yield an investor anticipates from a specific investment, considering its associated risk.