Question

The sun glass shack has annual $730000 and it has $100000 of accounts receivable. Based on a 365 day year what is it's days sales outstanding

Answer 1

Given that the sun glass shack has annual sales of $730000 and it has $100000 of accounts receivable.

We calculate it's days sales outstanding based on a 365 day year as follows:

Day’s sales outstanding = 365 days ÷ (Net sales/Accounts receivable)

`=(365)/((730,000)/(100,000))= 50 \ days`