Given the following information, compute accounts receivable turnover. Gross sales $ 150 , 000 Accounts receivable, beginning of year $ 18 , 000 Sales 135 , 000 Accounts receivable, end of year 22 , 000 \begin{array}{|lr|ll|}\hline ext { Gross sales } & \$ 150,000 & ext { Accounts receivable, beginning of year } & \$ 18,000 \\hline ext { Sales } & 135,000 & ext { Accounts receivable, end of year } & 22,000 \\hline\end{array} Gross sales Sales $150 , 000 135 , 000 Accounts receivable, beginning of year Accounts receivable, end of year $18 , 000 22 , 000 A) 6.75B) 7.50C) 6.13D) 6.82

Question

Given the following information, compute accounts receivable turnover.    Gross sales  $ 150 , 000  Accounts receivable, beginning of year  $ 18 , 000  Sales  135 , 000  Accounts receivable, end of year  22 , 000 \begin{array}{|lr|ll|}\hline 	ext { Gross sales }  &  \$ 150,000  &  	ext { Accounts receivable, beginning of year }  &  \$ 18,000 \\hline 	ext { Sales }  &  135,000  &  	ext { Accounts receivable, end of year }  &  22,000 \\hline\end{array}  Gross sales   Sales  ​ $150 , 000 135 , 000 ​  Accounts receivable, beginning of year   Accounts receivable, end of year  ​ $18 , 000 22 , 000 ​ ​ A)  6.75B)  7.50C)  6.13D)  6.82

Durga Venkateswar Dhulipalla · Accepted Answer

Final Answer : A, Explanation :  Accounts receivable turnover = Net sales / Average accounts receivableAverage accounts receivable = (Beginning accounts receivable + Ending accounts receivable) / 2= (18,000 + 22,000) / 2= 20,000Accounts receivable turnover = 135,000 / 20,000= 6.75

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