Examlex
Which of these capacities is NOT correctly defined?
Accounts Receivable Turnover
A ratio that measures how effectively a company collects its receivables, calculated by dividing total net sales by the average accounts receivable.
Inventory Turnover Ratio
A metric indicating how often a company's inventory is sold and replaced over a specific period, useful in evaluating the efficiency of inventory management.
Return on Equity
A measure of a corporation's profitability that reveals how much profit a company generates with the money shareholders have invested.
Average Collection Period
The average number of days it takes for a company to receive payments owed by its customers.
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