The Higher the Amount of a Company's Accounts Receivable Turnover

question 51

Multiple Choice

The higher the amount of a company's accounts receivable turnover,

• A)the shorter time period it takes to collect a receivable.
• B)the more assets a company has tied up in receivables.
• C)the longer it takes a company to collect its receivables.
• D)the more likely a company will experience cash flow problems.

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Definitions:

Landlord

An individual or entity that owns a property and rents it out to tenants in exchange for a periodic payment.

Exculpatory Clause

A clause that releases a contractual party from liability in the event of monetary or physical injury, no matter who is at fault.

Covenant Not to Compete

A legal agreement where one party agrees not to enter into or start a similar profession or trade in competition against another party.

Enforce

The act of compelling obedience or compliance with a law, rule, or obligation through legal or authoritative means.