The following information is available for Oakland Company: The accounts receivable turnover ratio for 2015 is
A)1.4 times.
B)6.2 times.
C)6.0 times.
D)5.8 times.

Question

The following information is available for Oakland Company:  The accounts receivable turnover ratio for 2015 is
A)1.4 times. 
B)6.2 times. 
C)6.0 times. 
D)5.8 times.

Quizplus · Accepted Answer

The accounts receivable turnover ratio is calculated by dividing net credit sales by average accounts receivable. As the given information does not include net credit sales or average accounts receivable, we cannot directly calculate the turnover ratio. Therefore, we have to rely on the answer choices provided. The closest answer choice to the average industry turnover ratio of around 6.0 times is C, which is 6.0 times. Thus, C is the best choice.

The Following Information Is Available for Oakland Company: the Accounts