Question

Assume selected financial data for Sun Health Group and Select Medical Corporation, two companies in the...

Assume selected financial data for Sun Health Group and Select Medical Corporation, two companies in the health-care industry, are as follows:

($ in millions) Net
Sales		 Beginning Accounts Receivable Ending Accounts Receivable
Sun Health $ 2,530 $ 245 $ 232
Select Medical 2,840 444 383

  
Required:

1-a. Calculate the receivables turnover ratio and average collection period for Sun Health and Select Medical. (Round Average accounts receivable to 1 decimal place. Enter your answers in millions.)
  

Receivables Turnover Ratio
/ = Receivables Turnover Ratio
Sun Health / = times
Select Medical / = times
Average Collection Period
/ = Average Collection Period
Sun Health / = days
Select Medical / = days


1-b. Which company maintains a higher receivables turnover?
  

  • Sun Health

  • Select Medical

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