The 2016 financial statements of BNSF Railway Company report total revenues of $19,829 million, accounts receivable of $1,272 million for 2016 and $1,198 million for 2015.
The company's accounts receivable turnover for the year is:
A) 17.0 times
B) 8.9 times
C) 16.1 times
D) 17.9 times
E) None of the above

Question

Quizplus · Accepted Answer

The accounts receivable turnover is calculated as total revenues divided by the average accounts receivable. Average accounts receivable for 2016 is calculated as (1,272 million + 1,198 million) / 2 = 1,235 million. Therefore, the turnover is 19,829 million / 1,235 million = 16.05, which rounds to 16.1 times.

The 2016 Financial Statements of BNSF Railway Company Report Total