Oral roberts dental supplies has annual sales of $5,200,000. ninety percent are on credit. the firm has $559,000 in accounts receivable. compute the value of the average collection period. (do not round intermediate calculations. use a 360-day year.)

QUESTION POSTED AT 16/04/2020 - 07:24 PM

Answered by admin AT 16/04/2020 - 07:24 PM

If this is talking about the percentage rate of the value received at that specific period, then it can be calculated as;

1. First, get the percentage equivalent of the value that’s currently on account receivable of this period. So, $559,000 divided by $5,200,000 equals to 0.1075.
2. Next, 0.1075 is multiplied to 100 to get the percentage. That gives us a rate of 10.75%.

Therefore, the percentage value of this collection 10.75%. 
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