Sequola Furniture Company's sales over the past three months, half of which are for cash, were as follows: April $ 670,000 March $ 420,000 1. Assume that Sequoia's collection period is 60 days. What would be its cash receipts in May? What would be its accounts receivable balance at the end of May? 2. Now assume that Sequoia's collection period is 45 days. What would be its cash receipts in May? What would be its accounts receivable balance at the end of May? 1. Collection period is 60 days Cash receipts May $ 540,000 Accounts receivable balance 2. Collection period is 45 days Cash receipts Accounts receivable balance. $ $ 480,000 605,000

Sequola Furniture Company's sales over the past three months, half of which are for cash, were as follows: April $ 670,000 March $ 420,000 1. Assume that Sequoia's collection period is 60 days. What would be its cash receipts in May? What would be its accounts receivable balance at the end of May? 2. Now assume that Sequoia's collection period is 45 days. What would be its cash receipts in May? What would be its accounts receivable balance at the end of May? 1. Collection period is 60 days Cash receipts May $ 540,000 Accounts receivable balance 2. Collection period is 45 days Cash receipts Accounts receivable balance. $ $ 480,000 605,000

Intermediate Financial Management (MindTap Course List)

13th Edition

ISBN:9781337395083

Author:Eugene F. Brigham, Phillip R. Daves

Publisher:Eugene F. Brigham, Phillip R. Daves

Chapter21: Supply Chains And Working Capital Management

Section: Chapter Questions

Problem 11P: Negus Enterprises has an inventory conversion period of 50 days, an average collection period of 35...

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