Nordstrom, Inc. operates department stores in numerous states. Suppose selected financial statement data (in millions) for 2020 are presented below. End of Year Beginning of Year Cash and cash equivalents $ 750 $ 71 Accounts receivable (net) 2,040 1,880 Inventory 850 830 Other current assets 410 359 Total current assets $4,050 $3,140 Total current liabilities $2,010 $1,640 For the year, net credit sales were $8,258 million, cost of goods sold was $5,328 million, and net cash provided by operating activities was $1,251 million. Compute the current ratio, accounts receivable turnover, average collection period, inventory turnover and days in inventory at the end of the current year.

a. Current ratio = 2.01, or 201%

b. Accounts receivable turnover = 4.21 times

c. Average collection period = 83 days

d. Inventory turnover = 6.34 times

e. Days in inventory = 57 days

Explanation:

a. Current ratio at the end of the current year

Current ratio = Current assets / Current liabilities = $4,050 / $2,010 = 2.01, or 201%

b. Accounts receivable turnover at the end of the current year

Average account receivable (net) = (2,040 + 1,880) / 2 = $1,960

Accounts receivable turnover = Net credit sales / Average account receivable (net) = $8,258 / $1,960 = 4.21 times

c. Average collection period at the end of the current year

Average collection period = (Ending account receivable (net) / Net credit sales) * 365 days = ($1,880 / $8,258) * 365 = 83 days.

d. Inventory turnover at the end of the current year

Inventory turnover = Cost of goods sold / Average inventory = $5,328 / $840 = 6.34 times

e. Days in inventory at the end of the current year.

Days in inventory = (Ending inventory / Cost of goods sold) * 365 days = (830 / 5,328) * 365 days = 57 days

answer; /// the correct answer is (10) days; /// good luck

answer90,000;