Question

JPJ Corp has sales of $1.09 ​million, accounts receivable of $45,000​, total assets of $4.94 million​ (of which $2.95 million are fixed​ assets), inventory of $ 144,000​, and cost of goods sold of $ 595,000.

What is​ JPJ's accounts receivable​ days?

Fixed asset​ turnover?

otal asset​ turnover?

Inventory​ turnover?

Answer 1

Calculation of account receivable days:
Account receivable days= (365*account receivable)/sales
Account receivable days= (365*45000/1090000)= 15.07 days
Calculation of fixed assets turnover ratio:
Fixed assets turnover ratio= sales/ fixed assets
Fixed assets turnover ratio= 1090000/2950000= 0.37 times
Calculation of total assets turnover ratio:
Total assets turnover ratio= sales/total assets
Total assets turnover ratio= 1090000/4940000= 0.22 times
Calculation of inventory turnover ratio:
Inventory turnover ratio= cost of goods sold/inventory
Inventory turnover ratio= 595000/144000= 4.13 times