Eleva Corporation's accounts receivable turnover for 2011 is closest to:
A) 4.63 times.
B) 2.91 times.
C) 5.42 times.
D) 68 days.

Question

Quizplus · Accepted Answer

Accounts receivable turnover is calculated by dividing net credit sales by the average accounts receivable. As net credit sales are not given in the question, we cannot calculate the exact accounts receivable turnover. However, by using the given information, we can approximate the accounts receivable turnover.

We are given that Eleva Corporation's average collection period for accounts receivable is 67 days. Average collection period is calculated by dividing 365 days by the accounts receivable turnover. Therefore, we can calculate the accounts receivable turnover as 365/67 = 5.42 times (approximate).

Hence, the closest answer choice is C) 5.42 times.

Eleva Corporation's Accounts Receivable Turnover for 2011 Is Closest To