Asked by
SPENCER DREIBELBIS
on Nov 08, 2024Verified
The average length of time it takes for a customer to pay for his or her credit purchases is referred to as:
A) The receivables turnover.
B) The cash period.
C) The interval measure.
D) Days' sales in receivables.
E) The payables period.
Credit Purchases
Transactions where goods or services are bought using credit instead of immediate cash payment, impacting liabilities and cash flow.
Receivables Turnover
This is a financial ratio that measures how efficiently a company collects debts from its customers, indicating how many times receivables are converted into cash in a period.
Interval Measure
The interval measure is a liquidity metric that estimates how long a company can operate using its current liquid assets without needing additional financing.
- Recognize the elements and computations involved in asset turnover ratios.
Verified Answer
SM
Learning Objectives
- Recognize the elements and computations involved in asset turnover ratios.