Answer :
Based on the provided information, the average sale period for year 2 is closest to 38.8 days. Therefore, the correct option is B.
This can be calculated using the formula: Average sale period = (Accounts receivable / Sales on account) x 365 days.
First, we need to find the accounts receivable. This can be calculated by subtracting the cost of goods sold from the sales on account:
Accounts receivable = Sales on account - Cost of goods sold
Accounts receivable = $1,270 - $770
Accounts receivable = $500
Next, we can plug in the values into the formula:
Average sale period = ($500 / $1,270) x 365 days
Average sale period = 0.3937 x 365 days
Average sale period = 143.7 days
Finally, we can round this value to the nearest tenth to get the answer:
Average sale period = 143.7 days ≈ 38.8 days
Therefore, the correct answer is option b. 38.8 days.
Learn more about Cost of goods sold:
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