Days' sales in receivables
A) is an estimate of the length of time the receivables have been outstanding
B) measures the number of times the receivables turn over each year
C) is credit sales divided by average receivables
D) is not meaningful and therefore is not used

Question

Quizplus · Accepted Answer

Days' sales in receivables is an estimate of the length of time the receivables have been outstanding, indicating the average number of days it takes customers to pay their outstanding bills. It helps in evaluating the effectiveness of a company's credit and collection procedures.

Days' Sales in Receivables