Frabine Company had $150,000 in sales on account last year.The beginning accounts receivable balance was $14,000 and the ending accounts receivable balance was $18,000.The company's accounts receivable turnover was closest to:
A) 4.69 times.
B) 8.33 times.
C) 9.38 times.
D) 10.71 times.

Question

Quizplus · Accepted Answer

Accounts receivable turnover = Sales on credit / Average accounts receivable

Average accounts receivable = (Beginning accounts receivable + Ending accounts receivable) / 2

Average accounts receivable = ($14,000 + $18,000) / 2 = $16,000

Accounts receivable turnover = $150,000 / $16,000 = 9.38 times (rounded to two decimal places)

Therefore, the closest answer choice is C: 9.38 times.

Frabine Company Had $150,000 in Sales on Account Last Year