Asked by
Maria Hawley
on Nov 15, 2024
Verified
Accounts receivable turnover is calculated by dividing net credit sales by the average accounts receivable.
Accounts Receivable Turnover
A financial metric that measures how many times a company collects its average accounts receivable in a period, indicating the efficiency of extending credit and collecting debts.
Average Accounts Receivable
The average amount of money owed to a company by its customers for goods or services provided on credit over a specified period.
- Comprehend the importance of variations in the accounts receivable turnover across distinct time frames.
- Comprehend the principle of ratio and its utilization in analyzing financial data.
Verified Answer
CA
Learning Objectives
- Comprehend the importance of variations in the accounts receivable turnover across distinct time frames.
- Comprehend the principle of ratio and its utilization in analyzing financial data.
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