Efficiency ratio: If Viera Ltd has an accounts receivable turnover of 3.9 times and net sales of $3,436,812, what is its level of receivables?
A) $881,234
B) $13,403,567
C) $1,340,357
D) $81,234

Question

Quizplus · Accepted Answer

The accounts receivable turnover ratio is calculated as net sales divided by average accounts receivable. Rearranging the formula to find the level of receivables: Receivables = Net Sales / Turnover Ratio = $3,436,812 / 3.9 = $881,234.

Efficiency Ratio: If Viera Ltd Has an Accounts Receivable Turnover