The following data were taken from The Hershey Company’s 2018 annual report. All dollar amounts are in millions.
Required
a. Compute Hershey’s accounts receivable turnover ratios for 2018 and 2017.
b. Compute Hershey’s average days to collect accounts receivables for 2018 and 2017.
c. Based on the ratios computed in Requirements a and b, did Hershey’s performance get better or worse from 2017 to 2018?
d. Assume it took Hershey 30 days to collect its receivables. Using an interest rate of 3.0 percent, calculate how much it cost Hershey’s to finance its receivables for 30 days in 2018.
