Which of the Following Is a Recommended Method Used to Figure

question 8

Multiple Choice

Which of the following is a recommended method used to figure the accounts receivable ratio?

• A)Divide the current accounts receivable balance by the average monthly accounts payable. 
• B)Divide the current accounts receivable balance by the average monthly gross charges. 
• C)Divide the current accounts receivable balance by the average weekly charges. 
• D)Divide the current accounts receivable balance by the average daily gross charges.

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Definitions:

Property Taxes

Levies imposed by local governments on real estate properties, calculated based on the property's value.

Compounded Annually

Interest calculated once per year on the initial principal, including all interest from previous periods.

Compounded Monthly

An interest calculation method where interest is added to the principal balance on a monthly basis, with each month's interest calculation based on the principal plus all previously compounded interest.

Insurance Premium

The amount of money an individual or business must pay for an insurance policy.