The Following Information Pertains to Ortiz Company What Is the Accounts Receivable Turnover for Ortiz?
A) 1

question 75

Multiple Choice

The following information pertains to Ortiz Company. Assume that all balance sheet amounts represent both average and ending balance figures. Assume that all sales were on credit. $\begin{array}{lr}\text { Assets }\\\text { Cash and short-term investments } & \$ 45,000 \\\text { Accounts receivable (net) } & 40,000 \\\text { Inventory } & 20,000 \\\text { Property, plant and equipment } & 210,000\\\text { Total Assets }&\$305,000\\\\\text { Liabilities and Stockholders' Equity }\\\text { Current liabilities } & \$ 50,000 \\\text { Long-term liabilities } & 95,000 \\\text { Stockholders' equity-common } & 160,000 \\\quad \text { Total Liabilities and Stockholders' Equity } & \$ 305,000\end{array}$ $\begin{array}{lr}\text { Income Statement }\\\text { Sales } & \$ 110,000 \\\text { Cost of goods sold } & 66,000 \\\text { Gross profit } & 44,000 \\\text { Operating expenses } & 30,000 \\ \text { Net income } & \$ 14,000\\\\\text { Number of shares of common stock } & 6,000 \\\text { Market price of common stock } & \$ 20 \\\text { Dividends per share } & .50\end{array}$ What is the accounts receivable turnover for Ortiz?

• A) 1.3 times
• B) 1.1 times
• C) 2.8 times
• D) 12.7 times

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Definitions:

Assembly Lines

A manufacturing process in which parts are added to a product in a sequential manner to create a finished product in the most efficient way.

Expected Production

The anticipated quantity of products or services to be produced in a specific period.

Labour Standards

The criteria or guidelines that define acceptable working conditions, including hours of work, safety, wages, and benefits.

Predetermined Time Standards

Time values assigned to specific tasks based on prior analysis, often used in manufacturing and work measurement to establish time expectations.