Don't use Ai.Answer in step by step with explanation. The accounts receivable turnover ratio measures the number of times the business collects the average accountsreceivable balance during the year. The lower the ratio, the faster the collections on account.A. TrueB. False

Let us discuss it in a step-by-step manner to prove our point. Step 1:We have to understand the…

Answered: The accounts receivable turnover ratio…

Managerial Accounting

15th Edition

ISBN:9781337912020

Author:Carl Warren, Ph.d. Cma William B. Tayler

Publisher:Carl Warren, Ph.d. Cma William B. Tayler

Chapter16: Financial Statement Analysis

Section: Chapter Questions

Problem 9E

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What relationship exists between the average collection period and accounts receivable turnover? Select one: a. There is a direct and proportional relationship. b. Both ratios are expressed in number of days. c. As average collection period increases (decreases) the accounts receivable turnover decreases (increases). d. Both ratios are expressed in number of times receivables are collected per year.
The numerator in calculating the accounts receivable turnover is a. average accounts receivable b. accounts receivable at year-end c. sales d. total assets
Activity measures: m. Calculate the accounts receivable turnover and number of days' sales in accounts receivable (based on a 365-day year) for the most recent year. n. Based on your analysis in m, do you believe that the company is doing an effective job at managing accounts receivable? What would you estimate the industry averages to be for the accounts receivable turnover and number of days' sales in accounts receivable? Explain. o. Calculate the inventory turnover and number of days' sales in inventory (based on a 365-day year) for the most recent year. p. Based on your analysis in o, to what extent does the company need to be concerned about its inventory management policies? In assessing the inventory management policies, would you be more interested in knowing current ratio or acid-test ratio information? Explain.
True or False. The number of days' sales in receivables is one means of expressing the relationship between average daily sales and accounts receivable.
calculate these (d) Current ratio :1 (e) Accounts receivable turnover times (f) Average collection period days
Which of the following calculations of receivable turnover is correct? A. Number of days in the year divided by receivable turnover. B. Net sale on account divided by average receivables. C. Cost of goods sold divided by average inventory. D. Net income divided by net sales.
A company reports the following: Sales Average accounts receivable (net) Determine (a) the accounts receivable turnover and (b) number of days' sales in receivables. Round your answers to one decimal place. Assume a 365- day year. a. Accounts receivable turnover $398,580 76,650 b. Number of days' sales in receivables days
Days' sales in receivables a.measures the number of times the receivables turn over each year b.is an estimate of the length of time the receivables have been outstanding c.is credit sales divided by average receivables d.is not meaningful and therefore is not used
I need answer of this question solution general accounting
What does the accounts receivable turnover ratio measure? Multiple Choice Average balance of accounts receivables How quickly accounts receivable turn into cash How quickly inventory turns into accounts receivable How quickly the accounts receivable balance increases
Mifflin Company reported the following for the current year: Net sales Cost of goods sold Beginning balance in accounts receivable Ending balance in accounts receivable Compute (a) accounts receivable turnover and (b) days' sales uncollected. Hint. Accounts receivable turnover uses average accounts receivable, and days' sales uncollected uses the ending balance in accounts receivable. Accounts Receivable Turnover Compute the accounts receivable turnover. Complete this question by entering your answers in the tabs below. Days Sales Uncollected Numerator: " $ 62,700 41,000 1 1 14,600 6,300 Denominator: Accounts Receivable Turnover Accounts Receivable Turnover Accounts receivable turnover times
How do you calculate accounts receivable turnover? Select an answer: Take the beginning A/R balance, add the ending A/R balance, divide by two, then divide the result into sales revenue Take the beginning A/R balance, add the ending A/R balance, then divide the result into sales revenue divided by two Take the ending A/R balance, subtract the beginning A/R balance, then divide the result into sales revenue. Take the starting A/R balance, subtract the ending A/R balance, then divide the result into sales revenue divided by two.

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The accounts receivable turnover ratio measures the number of times the business collects the average accounts receivable balance during the year. The lower the ratio, the faster the collections on account. A. True B. False