Dividing Accounts Receivable, net by Net Sales and multiplying the result by 365 is the:
A)Profit margin.
B)Days' sales uncollected.
C)Accounts receivable turnover ratio.
D)Average accounts receivable ratio.
E)Current ratio.

Question

Quizplus · Accepted Answer

Dividing Accounts Receivable, net by Net Sales and multiplying the result by 365 gives us the average number of days it takes for a company to collect its accounts receivables from its customers. This is known as the Days' sales uncollected ratio.

Dividing Accounts Receivable, Net by Net Sales and Multiplying the Result