Toppleson Manufacturing reports a receivables turnover ratio of 14.5.The industry average is 10.7.What most likely is causing this difference?

Question

Quizplus · Accepted Answer

A high receivables turnover ratio indicates that Toppleson is collecting its accounts receivable more frequently than the industry average. This could be due to effective procedures related to selling goods on account, such as timely invoicing and follow-up on unpaid accounts. Option A (selling to high-risk customers), Option C (providing superior products and services), and Option D (allowing customers too long to pay) are not necessarily related to the receivables turnover ratio.

Toppleson Manufacturing Reports a Receivables Turnover Ratio of 14