Asked by Christian Mirakaj on Jul 09, 2024
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The accounts receivable turnover is computed by dividing
A) total sales by average net accounts receivable.
B) net credit sales by average net accounts receivable.
C) total sales by ending net accounts receivable.
D) net credit sales by ending net accounts receivable.
Accounts Receivable Turnover
A financial metric that measures how efficiently a company collects revenue from its credit sales by dividing net credit sales by the average accounts receivable.
Net Credit Sales
Sales made on credit minus any returns or allowances.
Accounts Receivable
The money owed to a business by its customers for goods or services delivered but not yet paid for.
- Compute and elucidate the accounts receivable turnover ratio.
Verified Answer
Learning Objectives
- Compute and elucidate the accounts receivable turnover ratio.
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