The accounts receivable turnover is calculated by:
A) Dividing average accounts receivable by net sales and multiplying by 365.
B) Dividing net income by average accounts receivable.
C) Dividing net sales by average accounts receivable and multiplying by 365.
D) Dividing net sales by average accounts receivable.
E) Dividing average accounts receivable by net sales.

Question

Quizplus · Accepted Answer

The accounts receivable turnover is calculated by dividing net sales by average accounts receivable. This ratio measures how efficiently a company collects its receivables.

The Accounts Receivable Turnover Is Calculated By