Net sales$3,150,000
Average accounts receivable (net) 210,000
Determine (a) the accounts receivable turnover and (b) the number of days’ sales in receivables. Round to one decimal place.
Answer:
a. Accounts Receivable Turnover = Net Sales ÷ Average Accounts Receivable
Accounts Receivable Turnover = $3,150,000 ÷ $210,000
Accounts Receivable Turnover = 15.0
Average Accounts Receivable
Average Daily Sales
$210,000 ÷ ($3,150,000 ÷ 365)
$210,000 ÷ $8,630
24.3 days