The Account Receivable Turnover Measures

question 12

Multiple Choice

The account receivable turnover measures:

• A)How long it takes to sell accounts receivable to a factor.
• B)How often,on average,receivables are received and collected during the period.
• C)The relation of cash sales to credit sales.
• D)How long it takes to sell merchandise inventory.
• E)All of the options are correct.

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Definitions:

Debt Ratio

A financial ratio that measures the extent of a company’s or individual's leverage, calculated by dividing total liabilities by total assets.

Days' Sales in Inventory

A financial metric that calculates the average number of days a company takes to sell its inventory, indicating the efficiency of inventory management.

Dividend Yield

A fiscal metric indicating the annual dividend payment of a company as a proportion of its stock price.

Total Asset Turnover

A financial metric that measures the efficiency of a company's use of its assets in generating sales revenue.