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Do you use 360 or 365 when using number of days per year in the denominator? I recall in CPAexcel, it says you use 360. But, on Wiley page 242, it uses 365 instead of 360, for receivables collection period, inventory conversion period, and payroll deferral period. I have included an example below:
Receivables collection period = Average receivables/Credit sales per day
Receivables collection period = $3,000,000 / ($40,000,000/365 days)
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