A low receivables turnover indicates that
A)few customers are defaulting on their debts.
B)a large proportion of the company's sales are on credit.
C)the company's inventory is moving very quickly.
D)customers are making payments slowly.

Question

Quizplus · Accepted Answer

A low receivables turnover means that customers are taking longer to make their payments, which can indicate cash flow problems for the company. It is not a measure of default rates, proportion of sales on credit, or inventory turnover.

A Low Receivables Turnover Indicates That