QUESTION 25 The top management of Everest Manufacturing wanted to know how well the company is managing...

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Finance

QUESTION 25
The top management of Everest Manufacturing wanted to know howwell the company is managing its accounts receivable (AR) comparedto its peers. The management gathered the following informationfrom the aging schedule of AR:
Days Outstanding
Average Collection Period
% Weight
At most 30 days
23 days
40%
31 days to 60 days
54 days
25%
61 days to 120 days
93 days
20%
More than 120 days
168 days
15%
Based on their recently issued financial statements, Everestmanagement learned the weighted-average collection period of itsclosest competitors: 63 days for Gibraltar Corp., 65 days forMatterhorn Inc., and 68.5 days for Alps Co. Which of the followingcan Everest conclude about its AR management?
a.
The company has worse AR management than its peers.
b.
The company has AR management at par with its peers.
c.
The company has better AR management than its peers.

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QUESTION 25The top management of Everest Manufacturing wanted to know howwell the company is managing its accounts receivable (AR) comparedto its peers. The management gathered the following informationfrom the aging schedule of AR:Days OutstandingAverage Collection Period% WeightAt most 30 days23 days40%31 days to 60 days54 days25%61 days to 120 days93 days20%More than 120 days168 days15%Based on their recently issued financial statements, Everestmanagement learned the weighted-average collection period of itsclosest competitors: 63 days for Gibraltar Corp., 65 days forMatterhorn Inc., and 68.5 days for Alps Co. Which of the followingcan Everest conclude about its AR management?a.The company has worse AR management than its peers.b.The company has AR management at par with its peers.c.The company has better AR management than its peers.

Days Outstanding	Average Collection Period	% Weight
At most 30 days	23 days	40%
31 days to 60 days	54 days	25%
61 days to 120 days	93 days	20%
More than 120 days	168 days	15%

	a.	The company has worse AR management than its peers.
	b.	The company has AR management at par with its peers.
	c.	The company has better AR management than its peers.