Asked by Murali Krishna on Jun 06, 2024
Verified
If the accounts receivable turnover ratio increases,the number of days it takes to collect the receivables also increases.
Accounts Receivable Turnover Ratio
A financial metric indicating how efficiently a company collects cash from its credit customers by measuring how often receivables are collected during a period.
- Familiarize with the consequences of sales discounts, returns, and allowances on the presentation of financial statements.
Verified Answer
OG
Osiris GuityJun 10, 2024
Final Answer :
False
Explanation :
An increase in the accounts receivable turnover ratio indicates that a company is collecting its receivables more quickly, thus reducing the number of days it takes to collect on its receivables.
Learning Objectives
- Familiarize with the consequences of sales discounts, returns, and allowances on the presentation of financial statements.
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