Dividing Net Sales on Account by the Average Amount of Net

question 80

Multiple Choice

Dividing net sales on account by the average amount of net accounts receivable is the calculation for the

• A) accounts receivable turnover.
• B) working capital turnover.
• C) merchandise inventory turnover.
• D) plant and equipment turnover.

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Definitions:

Indirect Taxes

Taxes that are not directly paid by an individual but instead are levied on goods and services, such as sales tax or value-added tax.

Federal Government

The national government of a federal country, which holds the authority to govern the federation as a whole.

Proportional Tax

A tax system where the rate of taxation is fixed and does not change based on the income level, meaning everyone pays the same percentage of their income in taxes.

Excise Tax

A tax imposed on specific goods, services, or transactions, often included in the price of products like gasoline, tobacco, and alcohol.