Jackson, Inc. had net sales of $900,000 during 2019. On January 1, 2019, Jackson's accounts receivable were $160,000. On December 31, 2019 Jackson's accounts receivable were $200,000.
What was Jackson's accounts receivable turnover for 2019?

Question

Quizplus · Accepted Answer

The accounts receivable turnover is calculated as net sales divided by average accounts receivable. The average accounts receivable is ($160,000 + $200,000) / 2 = $180,000. Therefore, the turnover is $900,000 / $180,000 = 5.