Response to the following problem:
The following data are taken from the financial statements of Ovation Industries Inc. Terms of all sales are 1/10, n/55.
2008 2007
Accounts receivable, end of year $ 48,219 $ 52,603
Monthly average accounts receivable (net) 45,070 46,154
Net sales 320,000 300,000
a. Determine for each year (1) the accounts receivable turnover and (2) the number of days' sales in receivables. Round to nearest dollar and to one decimal place.
b. What conclusions can be drawn from these data concerning accounts receivable and credit policies?