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.
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