The accounts receivable turnover ratio can be used to assess the collectability of accounts as well as the average collection period.

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The accounts receivable turnover ratio is calculated by dividing net credit sales by the average accounts receivable. It provides information on how many times a firm's accounts receivable is turned over in a year. This can be used to assess the collectability of accounts, as a high turnover ratio indicates that accounts are being collected quickly, while a low ratio indicates that accounts are taking longer to collect. Additionally, the average collection period can be calculated by dividing the number of days in the period by the accounts receivable turnover ratio. Therefore, the accounts receivable turnover ratio can be used to assess both the collectability of accounts and the average collection period.

The Accounts Receivable Turnover Ratio Can Be Used to Assess