Question

Omega Co. has annual sales of $250,000, costs of goods sold of $168,000, and assets of $322,000. Accounts receivable are $86,200. What is the receivables turnover?

Answer 1

2.90 times

Step-by-step explanation:

The formula and the computation of the account receivable turnover is shown below:

Account receivable turnover ratio = Net credit sales ÷ Average accounts receivable

= $250,00 ÷ $86,200

= 2.90 times

The net credit sales would be equal to annual sales and the average account receivable equal to receivables turnover

All other information which is given is not relevant. Hence, ignored it