Excerpts from TPX Company's December 31, 2013 and 2012, financial statements are presented below:
$\begin{array}{lrr}&2013&2012\
\text { Accounts receivable } & \$ 80,000 & \$ 72,000 \
\text { Inventory } & 84,000 & 70,000 \
\text { Net sales } & 400,000 & 372,000 \
\text { Cost of goods sold } & 254,000 & 216,000 \
\text { Total assets } & 850,000 & 810,000 \
\text { Total stockholders' equity } & 500,000 & 450,000 \
\text { Net income } & 75,000 & 56,000
\end{array}$
-TPX Company's 2013 receivables turnover ratio is:

Question

Quizplus · Accepted Answer

The receivables turnover ratio is calculated by dividing net sales by average accounts receivable. The average accounts receivable is calculated by adding the beginning and ending accounts receivable and dividing by 2. For TPX Company, the average accounts receivable is ($72,000 + $80,000) / 2 = $76,000. The receivables turnover ratio is $400,000 / $76,000 = 5.3 times.

Excerpts from TPX Company's December 31, 2013 and 2012, Financial