Martin Sales provides the following information: Net credit sales: $800,000
Beginning net accounts receivable: $40,000
Ending net accounts receivable: $23,000
Calculate the accounts receivable turnover ratio.(Round to the nearest whole number. )
A)25 times
B)33 times
C)20 times
D)35 times

Question

Quizplus · Accepted Answer

The accounts receivable turnover ratio is calculated as Net Credit Sales divided by Average Accounts Receivable. Average Accounts Receivable = ($40,000 + $23,000) / 2 = $31,500. Therefore, the turnover ratio is $800,000 / $31,500 ≈ 25 times.

Martin Sales Provides the Following Information: Net Credit Sales: $800,000