Question: (Revenue and expense recognition; cash flow analysis] The Stengel Company showed the following pattern of sales. bad debt expense. and net receivables for 1997 through 2001 (in $ millions)
a. Calculate the cash collected from customers each year from 1997 to 2001.
b. For each year presented. calculate the following ratios:
(i) Bad debt expense/mica
(ii) Net receivables/sales
(iii) Cash collections/sales
c. Based on the patterns of sales. net receivables. and cash col-lections in part A and ratios calculated in part B, discuss the adequacy of the provision for bad debts.