The days-to-collect measure indicates:
A)the number of days an average selling and collecting cycle takes.
B)the average number of times the firm completes the selling and collecting cycle during the year.
C)the average number of days for a customer's payment to clear the banking system.
D)the average number of days before the company receives a customer's payment and uses the cash to re-order merchandise.

Question

Quizplus · Accepted Answer

The days-to-collect measure indicates the number of days an average selling and collecting cycle takes. This measure is used to evaluate the efficiency of a company in collecting its accounts receivable.

The Days-To-Collect Measure Indicates