Is this correct...
Mervyn’s Fine Fashions has an average collection period of 40 days. The accounts receivable balance is $80,000. What is the value of its credit sales?
Ave collection period = AR/Ave Daily Sales
40 = 80,000/Ave daily sales
Ave daily sales = 80,000/40 = $2,000
So yearly sales = $2,000 x 365 = $730,000
