Which of the following is true?
A) Accounts receivable fall as companies sell on credit.
B) Accounts receivable rise as companies receive payment.
C) Receivables turnover refers to how fast receivables are collected.
D) Days to Collect will increase as the receivables turnover increases

Question

Quizplus · Accepted Answer

Receivables turnover refers to how fast receivables are collected. The higher the turnover, the faster the company is collecting payments from its customers. Choices A and B are incorrect as they provide opposite statements. Choice D is incorrect as Days to Collect will decrease as the receivables turnover increases.

Which of the Following Is True