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Assume that Hickory Copany has the following data related to its accounts receivable:

2005 2006
net sales $1,425,000 $1,650,000

net receivables
beginning of 2005:375,000
beginning of 2006:333,500
end of 2005:420,000
end of 2006:375,000

Use these 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?

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