At the beginning of the year,Vici Ventures had accounts receivable of $220,000.At the end of the year,the company had accounts receivable of $340,000.During the year,Vici had total sales of $1,000,000,70% of which were credit sales.What was Vici's receivables turnover ratio for the year?

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The receivables turnover ratio is calculated by dividing net credit sales by average accounts receivable. Net credit sales are calculated by multiplying total sales by the percentage of credit sales. Average accounts receivable is calculated by adding the beginning and ending accounts receivable and dividing by 2.In this case, net credit sales are $1,000,000 x 70% = $700,000. Average accounts receivable is ($220,000 + $340,000) / 2 = $280,000. Therefore, the receivables turnover ratio is $700,000 / $280,000 = 2.50.

At the Beginning of the Year,Vici Ventures Had Accounts Receivable