Accounts Receivable Turnover and Days' Sales in Receivables
The Limited Brands Inc. sells women's clothing and personal health care products through specialty retail stores including Victoria's Secret and Bath & Body Works stores. The Limited Brands reported the following (in millions) for two recent years:
Year 2 Year 1Sales$10,364 $9,613 Accounts receivable269 267 Assume that accounts receivable (in millions) were $249 at the beginning of Year 1.
Compute the accounts receivable turnover for Year 2 and Year 1.
Compute the day's sales in receivables for Year 2 and Year 1.