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The accounts receivable turnover ratio is the ratio of net credit sales to average accounts
receivable. The turnover ratio shows the average number of times per year that the company
collects its debts. For example, a turnover ratio of 12 means the company takes about 1 month
2
to collect its debts, while a turnover ratio of means the company takes about 18 months to
3
collect its debts. How many months does it take the company whose accounts are shown in the
table above to collect its debts?
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Answers: 1
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The accounts receivable turnover ratio is the ratio of net credit sales to average accounts
receiva...
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