Axle Co.'s accounts receivable turnover was 9.9 for this year and 11.0 for last year. Betterman's turnover was 9.3 for this year and 9.3 for last year. These results imply that:
A) Axle's credit policies are too loose.
B) Betterman's turnover is improving.
C) Axle has the better turnover for both years.
D) Betterman is collecting its receivables more quickly than Axle in both years.
E) Betterman has the better turnover for both years.

Question

Quizplus · Accepted Answer

Axle Co. has a higher accounts receivable turnover than Betterman for both years, indicating it collects its receivables more quickly.

Axle Co'S Accounts Receivable Turnover Was 9