What does the accounts receivable turnover ratio measure?
A)How quickly accounts receivable turn into cash
B)How quickly the accounts receivable balance increases
C)Average balance of accounts receivables
D)How quickly inventory turns into accounts receivable

Question

Quizplus · Accepted Answer

Dividing a company's sales by its net accounts receivable tells how many times the net accounts receivable balance is "turned over" (converted into cash)each year.The higher the turnover,the shorter the collection period.

What Does the Accounts Receivable Turnover Ratio Measure