The Accounts Receivable Turnover Ratio Indicates How Often Account Receivables

question 59

True/False

The accounts receivable turnover ratio indicates how often account receivables are received and collected during the period.

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Definitions:

Accounts Payable

Liabilities or amounts owed by a company to suppliers for goods and services received but not yet paid for.

Inventory

The total amount of goods and materials held by a company, intended for sale or production.

Investing Transactions

Activities related to the acquisition or disposal of long-term assets and investments not included in cash equivalents within a company.

Cash Flow Statement

A financial statement that shows how changes in balance sheet accounts and income affect cash and cash equivalents.