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QUESTION

The Brenmar Sales Company had a gross profit margin (gross profits divided by sales) of 34 percent and sales of $ 9.4 million last year.

The Brenmar Sales Company had a gross profit margin​ (gross profits divided by ÷​sales) of 34 percent and sales of $ 9.4 million last year. 76 percent of the​ firm's sales are on​ credit, and the remainder are cash sales. ​ Brenmar's current assets equal $1.2 ​million, its current liabilities equal $297,500​, and it has $109,100 in cash plus marketable securities.

a. If​ Brenmar's accounts receivable equal $563,400​, what is its average collection​ period?

 The​ company's average collection period will be______ days. ​(Round to two decimal​ places.)

b. If Brenmar reduces its average collection period to 15 ​days, what will be its new level of accounts​ receivable?

c. Brenmar's inventory turnover ratio is 9.6 times. What is the level of​ Brenmar's inventories?

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