Parr Hardware Store Had Net Credit Sales of $8,000,000 and Cost

question 57

Multiple Choice

Parr Hardware Store had net credit sales of $8,000,000 and cost of goods sold of $5,000,000 for the year. The Accounts Receivable balances at the beginning and end of the year were $600,000 and $700,000, respectively. The accounts receivable turnover was

• A) 7.7 times.
• B) 4.6 times.
• C) 11.4 times.
• D) 12.3 times.

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Definitions:

Puffing

The act of making exaggerated, subjective statements or claims about a product or service that cannot be objectively verified, often used in sales and advertising.

Reasonable Consumer

A legal standard referring to a hypothetical person who is considered average or typical from the perspective of the consumer population, used in cases related to consumer protection and advertising.

Mislead

To guide someone into a wrong direction or give someone a wrong idea or impression.

Cooling-Off Rule

A federal regulation allowing consumers a set period of time to cancel contracts or purchases made at home or at locations other than the normal business premises of a company.