Question

Norwood Company reported a receivables turnover ratio of 9.7. Cost of goods sold was $435,000 and net sales revenue was $746,900. The average net receivables must have been:

Answer 1

The average net receivables must have been 72,000.

Receivables turnover ratio =  net sales ÷ average net receivables

9.7 = 746900 ÷ average net receivables

average net receivables = 746900 ÷ 9.7

average net receivables = 77000

More about net receivables:

Net receivables are the entire amount of money owed to a business by its clients less the amount that is most likely never to be paid. Net receivables are sometimes reported as a percentage, and a higher proportion shows that a company may collect more money from its clients.

Receivable turnover ratio:

Receivables turnover ratio is the name of an accounting metric that measures how well a business collects its accounts receivable. This ratio assesses the efficiency with which a business uses and manages the credit it lends to consumers, as well as the speed at which short-term debt is collected or paid.

Learn more about receivables here:

brainly.com/question/14032135

#SPJ1