Posted by
**Denise** on
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Assume that Hickory Company has the following data related to its accounts receivable:

2005

Net Sales $ 1,425,000

Net receivables

Beginning of year 375,000

End of year 420,000

2006

Net Sales $ 1,650,000

Net receivables

Beginning of year 333,500

End of year 375,000

Use the data to compute accounts receivable turnover ratios and average collection periods for 2005 and 2006.

Based on your analysis, is Hickory Company managing its receivables better or worse in 2006 than it did in 2005?

Please help with the above question.