A decreasing average receivables collection period could be associated with
A) increasing sales.
B) decreasing sales.
C) decreasing accounts receivable.
D) increasing sales and decreasing accounts receivable.

Question

Quizplus · Accepted Answer

An decreasing average receivables collection period means the business is collecting its accounts receivable faster, which can result from increased sales and/or decreased accounts receivable. Therefore, the best choice is D, as both increasing sales and decreasing accounts receivable would lead to a decreased average receivables collection period.

A Decreasing Average Receivables Collection Period Could Be Associated with