A firm's annual credit sales are $1.93 million, with 48.04% of its daily average paid...
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A firm's annual credit sales are $1.93 million, with 48.04% of its daily average paid out in purchases. It usually takes the company 34 days to meet its purchasing obligations. This payment pattern has not changed in recent years. However, the firm's commitment to accounts receivable has shifted based on its current annual net income of $27.69k which meets the 3.06% required return, anticipated by senior management a year earlier. Normally, the firm collects its accounts in 23 days, an average which remains unaffected. Required: In percentage terms, by how much are the firm's receivables greater (or less) than its payables
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