CP 8-4 Accounts receivable turnover and days’ sales in receivables

Apple Inc. designs, manufactures, and markets personal computers and related personal computing and communicating solutions for sale primarily to education, creative, consumer, and business customers. Substantially all of the company’s net sales over the last five years are from sales of its Macs, iPods, iPads, and related software and peripherals. For two recent fiscal years, Apple reported the following (in millions):

Assume that the accounts receivable (in millions) were $2,422 at the beginning of fiscal Year 1.

1. Compute the accounts receivable turnover for Year 2 and Year 1. Round to one decimal place.

2. Compute the days’ sales in receivables at the end of Year 2 and Year 1. Round to one decimal place.

3. What conclusions can be drawn from (1) and (2) regarding Apple’s efficiency in collecting receivables?