Presented here is basic financial information (in millions) from the 2009 annual reports of Nike and Adidas.
|
Nike |
Adidas |
|
|
Sales |
$19,176.1 |
$10,381 |
|
Allowance for doubtful accounts, beginning |
78.4 |
119 |
|
Allowance for doubtful accounts, ending |
110.8 |
124 |
|
Accounts receivable balance (gross), beginning |
2,873.7 |
1,743 |
|
Accounts receivable balance (gross), ending |
2,994.7 |
1,553 |
Instructions
Calculate the receivables turnover ratio and average collection period for both companies. Comment on the difference in their collection experiences.