Which of the following is true?
A)Accounts receivable fall as companies sell on credit.
B)Accounts receivable rise as companies receive payment.
C)Receivables turnover refers to how fast receivables are collected.
D)All of the answers are acceptable.

Question

Quizplus · Accepted Answer

Receivables turnover is a ratio that measures how quickly a company collects its accounts receivable, therefore, C is the correct answer. A is incorrect because accounts receivable increase when a company sells on credit, and B is incorrect because accounts receivable decrease when payments are received. And D is incorrect because not all options are acceptable.

Which of the Following Is True