Calculate the DSO of a Company Given the Following Information

question 13

Multiple Choice

Calculate the DSO of a company given the following information.

• A)0.02
• B)0.06
• C)21.9
• D)7.3

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Definitions:

Inventory

The merchandise or stock that a business has on hand to sell to customers.

Activity Ratios

Financial metrics that measure how efficiently a company utilizes its assets to generate sales or revenue.

Profitability

The ability of a business to earn a profit, determined by its revenue exceeding its costs and expenses over a specific period.

Solvency

The ability of an entity to meet its long-term financial obligations.