Presented here is basic financial information (in millions) from the 2009 annual reports of Nike and Adidas.
|
Nike
|
Adidas
|
|
Sales
|
$19,176.1
|
$10,381
|
|
Allowance for doubtful accounts, beginning
|
78.4
|
119
|
|
Allowance for doubtful accounts, ending
|
110.8
|
124
|
|
Accounts receivable balance (gross), beginning
|
2,873.7
|
1,743
|
|
Accounts receivable balance (gross), ending
|
2,994.7
|
1,553
|
Instructions
Calculate the receivables turnover ratio and average collection period for both companies. Comment on the difference in their collection experiences.