The Accounts Receivable Turnover Ratio Is Calculated by Dividing

question 25

Multiple Choice

The accounts receivable turnover ratio is calculated by dividing

• A) gross sales by ending net trade receivables.
• B) gross sales by average net trade receivables.
• C) net sales by ending net trade receivables.
• D) net sales by average net trade receivables.

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Definitions:

Incorporated

A legal process used to form a corporate entity or company which is recognized as a legal person under the law.

Public Corporation

A company whose shares are publicly traded on a stock exchange, making its financial information available to investors, analysts, and the public.

Operated

Pertains to the condition or manner in which equipment, machinery, or systems are managed, manipulated, or controlled.