If the Receivables Turnover Ratio Rises Significantly,the Increase May Be

question 39

True/False

If the receivables turnover ratio rises significantly,the increase may be a signal that the company is extending credit to high-risk borrowers or allowing an overly generous repayment schedule.

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Definitions:

Dissolution

The process of dissolving, where a solid becomes incorporated into a liquid to form a solution, often referring to geological processes.

Calcium Carbonate

A chemical compound, CaCO3, found in rocks (as the minerals calcite and aragonite) and is the main component of pearls, the shells of marine organisms, snails, and eggs.

Limestone

A sedimentary rock composed mainly of calcium carbonate, often formed from the skeletal remains of marine organisms.

Calcite

A common crystalline form of natural calcium carbonate, CaCO3, that is the primary constituent of limestone and marble.