Question

On average, your firm sells $26,400 of items on credit each day. The firm's average operating cycle is 41 days and it acquires and sells inventory, on average, every 24 days. What is the average accounts receivable balance

Answer 1

$448,800

Step-by-step explanation:

Calculation for the average accounts receivable balance

Average accounts receivable balance = $26,400 x (41 days - 24 days)

Average accounts receivable balance = $26,400×17days

Average accounts receivable balance = $448,800

Therefore the Average accounts receivable balance will be $448,800