A firm has sales of 1.2 million and 10 percent of the sales are for cash The year-end accounts receivable balance is 180000 What is the average collection period using 360 day year?

average collection period= accounts receivable/daily credit sales %10 of 1.2 million = 120000 = sales for cash 1.2m-120000=1.080000=sales on credit ( divide by 360 to find daily credit sales) ACP=180000/(1080000/360)= 60 days