The financial statements of Georgi Manufacturing Company report net sales of $595000 and accounts receivable of $80000 and $60000 at the beginning and end of the year respectively. What is the accounts receivable turnover for Georgi?

Question

Quizplus · Accepted Answer

Accounts receivable turnover = Net Sales / Average Accounts Receivable
Average accounts receivable = (Beginning accounts receivable + Ending accounts receivable) / 2
Average accounts receivable = ($80,000 + $60,000) / 2 = $70,000
Accounts receivable turnover = $595,000 / $70,000 = 8.5 times. Therefore, the best answer is B.

The Financial Statements of Georgi Manufacturing Company Report Net Sales