Given an accounts receivable turnover of 8 and annual credit sales of $362 000, the average collection period (360-day year)is [blank].
A)90 days
B)45 days
C)75 days
D)60 days

Question

Quizplus · Accepted Answer

The average collection period is calculated as 360 days divided by the accounts receivable turnover rate. With a turnover of 8, the calculation is 360 / 8 = 45 days.

Given an Accounts Receivable Turnover of 8 and Annual Credit