Which of the following is a sign that a company cannot quickly turn its receivables into cash?
A)A high receivables turnover ratio.
B)A low receivables turnover ratio.
C)A low average collection period.
D)Both a high receivables turnover ratio and a low average collection period.

Question

Quizplus · Accepted Answer

A low receivables turnover ratio indicates that a company is taking a longer time to collect its accounts receivables, meaning that it cannot quickly turn its receivables into cash. A high receivables turnover ratio and a low average collection period both indicate a company is efficient in collecting its accounts receivables and can quickly turn them into cash.

Which of the Following Is a Sign That a Company