A Company Has Net Sales of $1,200,000 and Average Accounts

question 48

Multiple Choice

A company has net sales of $1,200,000 and average accounts receivable of $400,000. What is its accounts receivable turnover for the period?

• A) 5.00
• B) 3.0
• C) 20.0
• D) 73.0
• E) 0.33

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Definitions:

Tax Authority

The governmental agency responsible for the administration of tax laws, collection of taxes, and enforcement of tax regulations.

Internal Revenue Code

The federal statute that codifies all the United States tax laws, including income tax, payroll tax, gift tax, estate tax, and many other types of taxes.

Tax Liability

The total amount of tax that an individual or entity is legally obligated to pay to a taxing authority based on income, property value, transactions, or other taxable events.

Wage-Earning Taxpayers

Individuals who receive income in the form of wages, salaries, or tips from employment.