Individuals who may have adequate creditworthiness could overextend themselves and lose more than they can afford if they get caught up in the excitement of gambling. Casino operators have larger accounts receivable. Casino operators historically lose money on operations. Possible reasons for the difference in the two ratios computed in (a) and (b) include: a. Compute the percentage of the aliowance for doubtful accounts to the accounts recelvable for Patient Care. Compute the percentage of the allowance for doubtful accounts to the accounts receivable for the XYZ Corporation.
As of a recent year, Patient Care reported accounts recelvable of $912, 000 and aliowance for doubitul accounts of 522,800 Round all amounts to one decimal place.
Patient Care manufactures and sells a wide range of healthcare products including Band-Aids 8 bandages and Tylenol 8. As of a recent year, XYZ reported accounts recelvable of $403, 000 and allowance for doubtful accounts of $67, 301. The XYZ Corporation owns and operates hotels and casinos including the XYZ Grand and the Bellagio in Las Vegas, Nevada.