Accounts receivable on January 1 was $30,000 and,at the end of the year it was $50,000.Net credit sales were $160,000.Accounts receivable turnover is:
A)2 times.
B)4 times.
C)5 times.
D)6)67 times.

Question

Quizplus · Accepted Answer

Accounts receivable turnover is calculated as Net Credit Sales divided by Average Accounts Receivable. Average Accounts Receivable = ($30,000 + $50,000) / 2 = $40,000. Therefore, Accounts Receivable Turnover = $160,000 / $40,000 = 4 times.

Accounts Receivable on January 1 Was $30,000 And,at the End