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MCS,PHD
Argosy University/ Phoniex University/
Nov-2005 - Oct-2011
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Phoniex University
Oct-2001 - Nov-2016
Accounts receivable analysis
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Xavier Stores Company and Lestrade Stores Inc. are large retail department stores. Both companies offer credit to their customers through their own credit card operations. In- formation from the financial statements for both companies for two recent years is as follows (all numbers are in  millions):
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 |
Xavier |
Lestrade |
Merchandise sales |
$8,500,000 |
$4,585,000 |
Credit card receivables—beginning |
820,000 |
600,000 |
Credit card receviables—ending |
880,000 |
710,000 |
a.    Determine the (1) accounts receivable turnover and (2) the number of days’ sales in receivables for both companies. Round to one decimal place.
b.                            Compare the two companies with regard to their credit card policies.
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