A Firm Has $42,900 in Receivables and $211,800 in Total

question 94

Multiple Choice

A firm has $42,900 in receivables and $211,800 in total assets. The total asset turnover rate is 1.45 and the profit margin is 4.2 percent. How long on average does it take the firm to collect its receivables?

• A) 7.16 days
• B) 9.45 days
• C) 11.68 days
• D) 31.25 days
• E) 50.99 days

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Definitions:

Yield Rate

The rate of return on an investment over a specified period, expressed as a percentage, considering both interest and dividends.

Compounded Semi-annually

When interest is compounded semi-annually, it is calculated and added to the principal amount twice a year.

Whale Population

The total number of whales in a particular species or geographical area, often monitored for conservation purposes.

Decrease Rate

A term that may refer to the rate at which a value is reducing over a period of time.