Question

Remington Companies had accounts receivable of $100,000 at 1/1. The only transactions affecting accounts receivable were sales of $900,000 and cash collectibles of $850,000, The account receivables turnover is

Answer 1

To calculate the accounts receivable turnover, divide net credit sales by average accounts receivable.

Step-by-step explanation:

To calculate the accounts receivable turnover, we need to divide the net credit sales by the average accounts receivable. Net credit sales is the difference between total sales and cash collected. In this case, the net credit sales would be $900,000 - $850,000 = $50,000.

The average accounts receivable can be calculated by adding the beginning and ending accounts receivable and dividing by 2. Therefore, the accounts receivable turnover would be $50,000 / (($100,000 + $100,000) / 2) = 0.5.