The Formula for Days in Accounts Receivable Are

question 18

Multiple Choice

The formula for days in accounts receivable are

• A) Current assets/Current liabilities
• B) (Cash + Marketable securities + Accounts receivable)/Current liabilities
• C) (Cash + Marketable securities)/((Annual expenses - Depreciation)/365)
• D) Accounts receivable/(Operating revenue/365)
• E) Current liabilities/((Annual expense - Depreciation)/365)

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Definitions:

Sample Size

The number of observations or data points in a sample used to estimate characteristics of a population.

Population Standard Deviation

A measure that quantifies the amount of variation or dispersion of a set of values in a population.

Sampling Distribution

The statistical distribution that represents the probability of various outcomes, originating from a vast number of samples from a targeted population.

Standard Deviation

The square root of the variance showing how much individual data points differ from the mean.