Based on the following data, what is the accounts receivable turnover? Sales on account during year
$700,000
Cost of merchandise sold during year
270,000
Accounts receivable, beginning of year
45,000
Accounts receivable, end of year
35,000
Inventory, beginning of year
90,000
Inventory, end of year
A) 17.5 110,000
B) 2.6
C) 20.0
D) 15.5

Question

Quizplus · Accepted Answer

The accounts receivable turnover is calculated as Sales on Account divided by the Average Accounts Receivable. Average Accounts Receivable = (Beginning Accounts Receivable + Ending Accounts Receivable) / 2 = (45,000 + 35,000) / 2 = 40,000. Accounts Receivable Turnover = 700,000 / 40,000 = 17.5.

Based on the Following Data, What Is the Accounts Receivable