Question

Assume that all balance sheet amounts represent both average and ending balance figures. Assume that all sales were on credit. Assets Cash and short-term investments $ 40,000 Accounts receivable (net) 25,000 Inventory 20,000 What is the accounts receivable turnover for this company?

Answer 1

Hie, the question you have provided is missing the Sales figures.

However steps to calculate the accounts receivable turnover are explained below:

Accounts receivable turnover is an activity ratio that shows how effective is the company managing credit extended to debtors.

Accounts receivable turnover = Net Credit Sales / Accounts Receivable

From Our Scenario we have the following

Net Credit Sales = Missing

Accounts Receivable = $25,000

The Ratio is measured in times.