Asked by Casey Hamilton on Jul 16, 2024
Verified
The accounts receivable turnover indicates how often accounts receivable are collected during the period.
Accounts Receivable Turnover
A financial ratio that measures how efficiently a company collects revenue from its credit customers, calculated by dividing net credit sales by the average accounts receivable.
- Comprehend the computation of the accounts receivable turnover ratio and its significance in evaluating a firm's effectiveness in receivables collection.
Verified Answer
TN
Thu Ngân Bi?n Th?Jul 19, 2024
Final Answer :
True
Explanation :
The accounts receivable turnover ratio measures the number of times a company collects its average accounts receivable balance during a specific timeframe. It indicates how quickly a company collects its outstanding debts from customers.
Learning Objectives
- Comprehend the computation of the accounts receivable turnover ratio and its significance in evaluating a firm's effectiveness in receivables collection.
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