Which of the following items is a measure of a company's ability to collect receivables?
A)The days' sales in receivables
B)The current ratio
C)The inventory turnover ratio
D)The acid-test ratio

Question

Quizplus · Accepted Answer

The days' sales in receivables measures the average number of days it takes a company to collect its accounts receivable. It is a key indicator of a company's ability to convert its receivables into cash. B, C, and D relate to other aspects of a company's financial health.

Which of the Following Items Is a Measure of a Company's