Use the Table for the Question(s)below

question 13

Multiple Choice

Use the table for the question(s) below.
Consider the following realized annual returns:
-The average annual return on the Index from 2000 to 2009 is closest to:

• A)7.10%
• B)4.00%
• C)9.75%
• D)8.75%

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Definitions:

Accounts Receivable Turnover

A financial metric that measures how efficiently a company collects revenue from its credit customers, calculated as sales divided by the average accounts receivable.

Days' Sales in Receivables

A financial metric that measures how quickly a company collects on sales made on credit, indicating the average number of days it takes to convert receivables into cash.

Allowance Method

An accounting technique used to estimate the amount of uncollectible accounts receivable and adjust for bad debts.

Uncollectible Accounts

Accounts receivable that a business is unable to collect, often written off as a bad debt expense.