Geisel,Inc Had Credit Sales for 2014 of $510,000

Essay

Geisel,Inc had credit sales for 2014 of $510,000.and sales returns of $10,000.Credit sales for 2013 were $610,000 and sales returns were $10,000.Accounts receivable on December 31,2014 were $148,000.The allowance for doubtful accounts at December 31,2014 before adjustment had a debit balance of $1,000.Bad debt expense of $6,000 was recorded for 2014.
a.Calculate the accounts receivable turnover ratio and the days to collect for 2013 and 2014 (round each calculation to one decimal place).
The net receivables balance reported on the company's 12/31/12 financial statements was $120,000.The net receivables balance reported on the 12/31/13 financial statements was $130,000.
b.Discuss the implications of the receivables turnover ratio and days to collect as calculated in part (a).Discuss possible reasons for any changes in the values for these ratios,and implications for the provision for uncollectible accounts.