If credit sales remain the same and accounts receivable decrease, accounts receivable turnover will increase.

Name: If credit sales remain the same and accounts receivable decrease, accounts receivable turnover will increase.
Brand: Quizplus
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Question

Quizplus · Accepted Answer

A decrease in accounts receivable, with constant credit sales, indicates that the company is collecting its receivables more quickly. This leads to an increase in the accounts receivable turnover ratio, which measures how efficiently a company collects on its receivables.

If Credit Sales Remain the Same and Accounts Receivable Decrease