The number of days' sales in receivables
A) is an estimate of the length of time the receivables have been outstanding
B) measures the number of times the receivables turn over each year
C) is credit sales divided by average receivables
D) is not meaningful and therefore is not used

Question

Quizplus · Accepted Answer

The number of days' sales in receivables is an estimate of the length of time the receivables have been outstanding. It measures the average number of days that a company takes to collect its accounts receivable.

The Number of Days' Sales in Receivables