Dividing Accounts Receivable by Net Sales and Multiplying the Result

question 133

Multiple Choice

Dividing accounts receivable by net sales and multiplying the result by 365 is equal to the:

• A)Profit margin.
• B)Days' sales uncollected.
• C)Accounts receivable turnover ratio.
• D)Average accounts receivable ratio.
• E)Current ratio.

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Definitions:

Liabilities Section

A part of the balance sheet that lists obligations the company must pay to others, such as loans, accounts payable, and mortgages.

Non-Controlling Interest

A portion of equity ownership in a subsidiary not owned by the parent company, indicating minority shareholders' interest in the subsidiary's net assets.

Fair Value

The estimated market price of an asset or liability, reflecting current market conditions and valuation techniques.

Business Valuation

The process of determining the economic value of a business enterprise or ownership interest using various valuation techniques.