A high times debtors turnover indicates:
A) the entity's credit sales have decreased.
B) a small percentage of the entity's sales are on credit.
C) the entity is more efficient in collecting monies owing from customers.
D) customers are taking longer to pay their accounts.

Question

Quizplus · Accepted Answer

A high debtors turnover indicates that the entity is collecting monies owing from customers more efficiently. This means that customers are paying their debts more quickly, which results in a faster turnover of accounts receivable.

A High Times Debtors Turnover Indicates