Miyagi Data, Inc., sells earnings forecasts for Japanese securities. Its credit

Question

Miyagi Data, Inc., sells earnings forecasts for Japanese securities. Its credit terms are 1/30, net 40. Based on experience, 65 percent of all customers will take the discount. (Enter your answer as directed, but do not round intermediate calculations.) Required: (a) What is the average collection period? Average collection period (b) If the company sells 1,350 forecasts every month at a price of $2,450 each, what is its average balance sheet amount in accounts receivable? (Enter your answer in dollars, not millions of dollars (e.g., 1,234,567). Round your answer to 2 decimal places (e.g., 32.16).) Average accounts receivable

Explanation / Answer

Average collection period = 34 days

(b) And the average daily balance is: Average balance = =1350*(2450)*(12)*(34/365)

Average balance = $ 3697150.685

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