Turnover Ratios for Accounts Receivable and Inventory
Ken's and Den's Recreational Products,Inc., reports the following information in its 2000 financial statements:
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Balance (dollars in millions)
|
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January 1, 2000
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December 31, 2000
|
|
Accounts receivable (gross)
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$14
|
$12
|
|
Allowance for uncollectible accounts
|
1
|
2
|
|
Inventory
|
20
|
26
|
|
During 2000:
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|
|
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Sales
|
|
80
|
|
Cost of goods sold
|
|
55
|
Required
Determine Ken's and Den's accounts receivable collection period ratio and the number of days' sales in ending inventory during 2000.