$438,000
Average Daily Sales = $36,000/30 = $1200
$1200 per day * 365 days per year = $438,000
The annual credit sales is determined to be equal to $438,000 with receivable amount equal to $36,000 to be collected within 30 days.
Credit sales represents the disposal of goods or services made by a company to its debtors.
Given values:
Accounts receivables: $36,000
Average collection period: 30 days
Days in a year: 365
Computation of value of annual credit sales :
[tex]\rm\ Annual \rm\ Credit \rm\ Sales=\frac{\rm\ Accounts \rm\ Receivable}{\rm\ Average\rm\ Collection \rm\ Period} \times\ \rm\ Number \rm\ of \rm\ yearly \rm\ days\\\rm\ Annual \rm\ Credit \rm\ Sales=\frac{\$36,000}{30}\times\ 365\\\rm\ Annual \rm\ Credit \rm\ Sales=\$438,000[/tex]
Therefore, when the accounts receivables are $36,000 with collection period of 30 days then the annual credit sales comes out to be $438,000.
Learn more about the accounts receivable in the related link:
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