A high accounts receivable turnover ratio indicates
A) customers are making payments quickly.
B) a large portion of the company's sales are on credit.
C) many customers are not paying their receivables.
D) the company's sales have increased.

Question

Quizplus · Accepted Answer

A high accounts receivable turnover ratio means that customers are making payments quickly, and the company is collecting its accounts receivable efficiently. This indicates good management of accounts receivable and healthy cash flow for the company.

A High Accounts Receivable Turnover Ratio Indicates