An increase in which one of the following is most apt to be an indicator of an accounts receivable policy that is too restrictive?
A) Bad debts.
B) Accounts receivable turnover rate.
C) Accounts receivable period.
D) Credit sales.
E) Operating cycle.

Question

Quizplus · Accepted Answer

An increase in the accounts receivable turnover rate indicates that a company is collecting its receivables more quickly. If the policy is too restrictive, fewer customers may be allowed to purchase on credit, leading to faster collections and a higher turnover rate.

An Increase in Which One of the Following Is Most