C 1694 D None of the above tainment reported the following i

C) 1.694 D) None of the above tainment reported the following information on their annual re ports Dream Enter for the years ended December 31, 2013 and 2012: 17. 2012 $280,000 $160,000 2013 Sales Accounts(Net) Rec. (Net) $86,000 $92,000 COLLECTION PERIOD for 2013 is: Dream Entertainment\'s AVERAGE A) I 16.02 Days B) 110.5 Days C) 262.58 Days D) None of the above

Solution

A) 116.02 Days

Receivables turnover = Sales revenue / Average accounts receivable = $280,000 / [($86,000 + $92,000) / 2] = 3.146

Average collection period = 365 / 3.146 = 116.02 days