Martin Sales Provides the Following Information: Net Credit Sales: $750,000

question 46

Multiple Choice

Martin Sales provides the following information: Net credit sales: $750,000
Beginning net accounts receivable: $40,000
Ending net accounts receivable: $20,000
Calculate the accounts receivable turnover ratio. (Round to the nearest whole number.)

• A)24 times
• B)25 times
• C)27 times
• D)22 times

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Definitions:

Sales Return

goods returned by the customers to the seller after the sale, reducing the gross sales figure.

Gross Profit

The profit a company makes after deducting the costs associated with making and selling its products, or the costs associated with providing its services.

Net Sales

The revenue a company earns from sales after subtracting returns, allowances for damaged or missing products, and discounts.

Allowance for Doubtful Accounts

A contra-asset account used to estimate the portion of accounts receivable that is expected to be uncollectible.